Employment

Basic metal production directly employs 6-7 million people. The iron and steel sector alone accounts for about 75% of the total. Despite the rise in commodity prices and the upturn for the industry since 2001/02, which has been largely fuelled by demand in Asia, particularly China, employment in the major steel producing countries continues to stagnate. Given the vulnerability of the sector to cyclical fluctuations and recent mergers and acquisitions, it can be expected that, with lessening demand or increased production from new plants currently being built, overproduction might result in a fall in of prices and thus lead to further rationalization with strong repercussions on employment figures.

Technological change, privatization, restructuring and environmental issues have come to the fore in affecting basic metal industries and their workforce. The impact of these factors will continue, at least in the medium term, particularly in countries in transition, the fast-moving economies in Asia and in some developing countries. In addition, some analysts fear that initiatives addressing climate change might create strong incentives for the relocation of plants and changes in the technologies used that might affect employment in the sector.

The relatively labour-intensive (and often polluting) open-hearth steel-making method now only accounts for about 2.4% of production, although it is more widely used in the Commonwealth of Independent States (CIS) (accounting for 23.9% of output in 2006). Basic oxygen furnaces, which also use iron from blast furnaces, now account for 65.5% of global output. The proportion of steel made in electric arc furnaces (EAF) rose from 28% in 1990 to 32% in 2006, where it has remained. Growth in EAF output has been constrained by the fact that these furnaces have largely been unable to compete in the markets for flat steel products - a major output. However, innovative techniques in steel casting are rapidly enlarging the product market in which EAF can compete. Thin slab casting techniques, for example, are displacing an increasing proportion of the steel now being produced via blast furnaces.

These newer technologies are not only far less labour-intensive, but have also had a strong impact on job profiles of metalworkers seeking work in these plants. Job requirements have changed considerably from those typically encountered 25 years ago: there is a much less demand for unskilled or low-skilled workers, but at the same time, some demand for highly skilled employees. It is clear that the resulting need for workers to find employment outside the sector and changed skill requirements have led to a focus on skills development as one of the top issues for the sector.