Slowdown hits Arcelor Mittal, may lay off workers

THE STEEL GIANT: ArcelorMittal recently announced that it had reduced production in North America.

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New York: The world's largest steelmaker ArcelorMittal said on Tuesday that it might lay off 16 percent of its U.S. workforce as a result of production cuts.

ArcelorMittal recently announced that it had reduced production in North America by 40 percent because of lower demand.

"As a result, ArcelorMittal has notified the United SteelWorkers (union) about the potential for an indefinite layoff of 2,444 employees at its Burns Harbor facility effective beginning the second half of January 2009," said a company spokesman in Chicago.

Under federal law, the steelmaker had to file an official notification of possible layoffs at the Burns Harbor steel plant outside Gary, Indiana.

"Potential workforce reductions are a direct result of the extraordinary economic environment we are facing and the company hopes to return workers to their jobs as market conditions warrant," spokesman Adam Warrington said.

Recently, the Europe-based company announced measures including temporary output cuts of 35 percent, up from a previous 15 percent, a pause in its growth strategy, deeper cost cuts and a reduction in debt, in response to a global economic slowdown.

ArcelorMittal stock was up $2.45, or 11.54 per cent, at $23.68 in afternoon trading on the New York Stock Exchange.