Shop floors at steel factories across SA were abandoned on Tuesday after workers downed tools and embarked on an indefinite strike across the country that is set to bring an important component of the economy to its knees.
Workers affiliated with the National Union of Metalworkers of SA (Numsa) in the steel and engineering industry went on strike over a long-standing dispute on salary increases in 2021.
The strike, which involved some of Numsa’s 432,000 workers, is reminiscent of the one in 2014 that lasted for four weeks and cost the steel and engineering sector between R300-million and R500-million per day, or R6-billion for the broader economy.
News of the strike sent the share price of ArcelorMittal SA, one of the country’s big steelmakers, nearly 1% lower on Tuesday, wiping off R68-million from its value on the JSE.
The steel and engineering industry is an important component of SA’s economy: it represents nearly 2% of the country’s economic output and is responsible for 190,000 direct jobs.
The industry is battling to survive an environment in which steel prices are depressed because of cheap imports from China. Steel demand is also in the doldrums as big construction and infrastructure projects have dried up since the 2010 Fifa World Cup.
On the first day of their strike on Tuesday, workers affiliated with Numsa marched to the Metal and Engineering Industry Bargaining Council in Johannesburg and handed over a memorandum reiterating their demand for inflation-beating salary increases. The council is where workers and employers in the steel and engineering industry negotiate the terms of employment.