The cuts at Whyalla, which will save the company $60 million, are expected to affect about 200 employees and 50 contractors over the next six to eight months.
These job losses are in addition to the 55 positions cut in October.
Chief executive of steel Steve Hamer said the company was only part way through its cost cutting.
“While we have made good progress in identifying $60 million of our target, it’s crucial that we achieve another $40 million of annualised savings and implement the already identified savings,” he said.
In a statement this morning, Arrium said the latest job cuts were part of its cost-reduction and “productivity improved target” program.
“We are focussed on identifying and delivering the balance of our target as quickly as possible, and this will require the support of all our stakeholders.
“While this is good progress towards the target, the steelworks continues to be put under pressure by the impact of the oversupply of steel globally. “
“Labour costs are the largest proportion of the steelworks’ production costs.
“To achieve our target, it is necessary that we further reduce these costs.
“This will include a reduction in the number of employees and contractors, as well as some changes to shift rosters and operating hours.
“All employees will be treated fairly and respectfully throughout this process, with affected employees receiving full entitlements including redundancy payments and other assistance such as outplacement services and counselling.”
Terrible news for steel workers at Arrium in Whyalla today. If there was something we could do about international iron ore prices we would.
— Tom Koutsantonis (@TKoutsantonisMP) November 15, 2015
SA Treasurer Tom Koutsantonis said after the Arrium announcement that the government was powerless to increase iron ore prices.
“If there was something the State Government could do to increase the global price of iron ore, it would,” he said.
“The collapse in global iron ore prices is having a dramatic effect on resources and steel industries, with companies like Arrium also dealing with increased price competition from imports sourced from China and other steelmaking countries.”
Koutsantonis said the government would provide assistance for the sacked workers and continue to create opportunities for SA companies to “thrive as global commodity prices recover”.
“Our thoughts today are with the workers affected by this decision.
“This State Government continues to standby Arrium and the Whyalla community to ensure that steelmaking remains a major contributor to jobs and economic prosperity in South Australia.”
Arrium announced last month that 55 jobs would potentially go to make savings at the structural mill reheat furnace and minerals processing plants.
It’s proving to be a bad week for SA jobs. Workers at Alinta’s Leigh Creek operations face their last day at the coal mine tomorrow.
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