Gerdau Steel will lay off about 31 union steelworkers from its St. Paul plant on Friday, Feb. 1, keeping employment levels just above the terms required by the forgivable loan the company received last year from the St. Paul Port Authority and a pending agreement with the state.
The Brazil-based steel company has more than 300 steelworkers and up to 70 non-union managerial personnel and support staff at its St. Paul plant near the Mississippi River, at the corner of Interstate 494 and U.S. 61. The plant is undergoing a $50 million upgrade.
After layoffs, the company will employ about 340 workers.
"It's based on market conditions right now," said company spokesman Philip Bell, who is based in Tampa. "This just underscores the need to get our (modernization) project finished, so St. Paul is a modern mill, and St. Paul won't be faced with these unfortunate choices in the future."
Bell and St. Paul city officials characterized the layoffs as temporary. Steelworkers Local 7263 President Chuck Nippoldt said he urged the company to keep employees on the payroll in training capacities.
"We actually cut from four shifts down to three shifts back in October, but I convinced them to keep the fourth shift around for training purposes," Nippoldt said. "They told me they were hoping everything would start picking up around the first of the year, and that didn't happen."