Steel Wills

By Janice Castro

More than 1,000 steelworkers bowed their heads to pray in the McBride Union Hall in Gary last Thursday night before heading to picket the huge Gary Works steel plant. For the first time in 27 years, U.S. Steel, now a division of the newly renamed USX corporation, was shut down. In all, 23,000 members of the United Steelworkers union walked off their jobs at 16 plants in nine states, from Pennsylvania to Utah. The workers insist that the company has locked them out, while management calls the action a strike. By any name, predicts Union Spokesman Gary Hubbard, "it's going to be a long fight." The walkout began after negotiations on a new contract broke down. USX rejected a union offer of a wage freeze, insisting that the company needs pay-and-benefit concessions to stay in line with industry labor costs. Said a tough-talking USX Chairman David Roderick: "We're going to get a competitive labor agreement, and we'll settle for nothing less."

Like other steelmakers, USX is struggling to return to profitability in an industry that suffers from overcapacity and tough foreign competition. Since 1982 the eight largest U.S. steel companies have lost a total of $8 billion. Several are now in precarious financial shape. Three weeks ago LTV, the second-ranking manufacturer, sought protection from its creditors with a Chapter 11 bankruptcy petition.

In contracts settled since April, the United Steelworkers has given wage- ) and-benefits concessions to LTV, Inland Steel, National Steel and Bethlehem, the third-largest manufacturer. National Steel's workers accepted a $1.50-an- hour cut, reducing hourly labor costs to $22.72, and LTV cut its costs by $3.60 an hour, to $22.60. USX negotiators have insisted that the firm needs a savings of at least $2 an hour, to about $23, to stay competitive. USX underscored that demand last week when it reported that second-quarter earnings had plummeted by 92%, to $14 million. A major factor was the firm's U.S. Steel division, which lost $42 million during the period.

LTV also had labor troubles last week. Some 3,600 workers were on strike at the company's Indiana Harbor Works in East Chicago, Ind., because LTV, as part of its bankruptcy strategy, had abruptly canceled benefits for 66,000 retired workers. On Thursday, Federal Bankruptcy Judge Burton Lifland ordered the company to pay the benefits for six more months. That ruling ended the six-day walkout and permitted LTV to reap a short-term bonus in extra orders from USX clients.

The walkout at USX is not likely to be settled so quickly. Armed with a strike fund of more than $200 million, the union says it can stay off the job for two years. But a long walkout would be costly for both sides. Roderick has said some USX plants may never reopen. And strike benefits do not replace salaries. Steelworker Jeff Smith, who supports a family of four, will draw $60 a week from his Gary local, just 15% of his usual salary of $400. Says he: "There've been good times at the mill in the past. We'll just have to hope for better times up the road." For many steelworkers, whose numbers have already declined from 700,000 in 1978 to 140,000 today as the industry has shrunk, those times may prove to be painfully beyond reach.

With reporting by Lee Griggs/Chicago and Raji Samghabadi/New York