America’s Steel Communities Make a Comeback
From the AAM
For the first time in years, people in steel towns across the country have reason to be optimistic.
Surging steel imports from countries like China long threatened the viability of these communities. China and other countries heavily subsidize their steel industries, making too much product and flooding the global market. That steel is then dumped into the U.S. market at rock-bottom prices, far below fair market value.
America's steel industry endured the pain of this unfair trade for years. Tens of thousands of workers were laid-off, dozens of mills closed, and entire communities suffered. Our national security also was at risk, since we need steel for the military and critical infrastructure.
In April 2018, the Trump administration initiated "Section 232" action to defend American steel from the onslaught of unfairly traded imports. Since that time, things have stablized. Production is up and thousands of new jobs have been announced, along with billions of dollars in investments. America's steel towns are back to work.
Granite City is Ready to Make a Comeback
Ever since she was a little girl, Victoria Arguelles dreamt of opening her own café, somewhere that could serve as a gathering place for residents of her hometown of Granite City.
The tight-knit Illinois community, located about 10 miles northeast of St. Louis, is a quintessential Midwestern industrial town. The city’s main employer is Granite City Works, a U.S. Steel mill that makes hot-rolled, cold-rolled and coated sheet steel products for customers in a variety of industries.
Arguelles never worked in the mill, and nobody in her family did, either. Instead, she focused on her dream, and opened Kool Beanz Café in 2014, right in the heart of Granite City’s downtown. It quickly became that gathering place she had long imagined.
Then the steel mill shutdown.
Facing an onslaught of unfairly traded steel imports from countries like China, U.S. Steel idled Granite City Works in December 2015. About 2,000 workers were laid off – in a town of around 26,000 people.
True to form, Granite City rallied. Fundraisers and food drives were started to keep folks afloat, especially since it was the holiday season. But there was a psychological shift in Granite City.
“It’s scary,” Arguelles recalled. “People really put on the brakes, and they’re just hesitant to spend their money, and some people move, and some people move in. You just never know what’s going to happen, but it definitely halted things.”
Granite City Mayor Ed Hagnauer described the mill’s closure as “devastating.” About 5,000 jobs in Granite City are connected to U.S. Steel in some way, either directly at the plant or at one of the satellite businesses that are tied to it, he said. Plus, there are all the smaller businesses – like Kool Beans Café – that feel the effects.
“You would walk around town and people were down, people were sad,” he said. “It was just like they had taken the air out of our community, after we had gone through a couple of really good years.”
For the 2,000 mill employees, things were even worse. Dan Simmons, president of United Steelworkers (USW) Local 1899, noted that the mill’s workers are prepared for the ramifications of the cyclical nature of the steel business, which sometimes leads to short layoffs.
But the 2015 shutdown was a whole different story.
“There weren’t jobs available at the time to be had around here, so they weren’t finding other work, so these guys were losing everything they worked hard for, for a lot of years,” he said. “Pulling their kids out of college. … One of my best friends committed suicide over this. We went through a lot here.”
This is not how this story ends, however.
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Icon Mechanical has been connected to Granite City Works since 1995, working on site to keep things operating safely. Although the manufacturing and engineering firm undertakes work for a variety of clients in the industrial and commercial fields, about half of its industrial group is tied to U.S. Steel in some way.
Like other businesses in town, Icon Mechanical took a hit when Granite City Works went idle, said Steve Faust, who oversees business development and is the diversity coordinator at the company. But Icon Mechanical continued to do small maintenance projects on site, and over the years, Icon employees heard rumblings that there would be a restart at the plant.
There were always rumblings, Faust recalled – until the monumental day when the rumblings were true.
Two years and three months after being idled, Granite City Works was coming back online. U.S. Steel announced in March 2018 that it would restart one of the two blast furnaces at Granite City Works. A few months later, the company said it would restart the other.
President Trump’s decision to place tariffs on steel imports gave the company confidence things were about to stabilize. U.S. Steel begin to invest once again at its facilities across the country, including in Granite City.
“We were ready for a parade,” Mayor Hagnauer said. “People were happy, people were talking about going back to work, the opportunities to work.”
At the local USW headquarters, steelworkers were ecstatic. Many came to Simmons’s office in tears; his phone rang off the hook. “That feeling of relief comes over you, and you can’t get the word out fast enough,” Simmons recalled.
“It was just a jolt of enthusiasm for the whole community,” Faust echoed. “Everybody who wanted to go back to the mill was going back to the mill. If you had a job there and you wanted to go back, you were going back. Within a matter of days, we were back to a crew of 160 men working in U.S. Steel, putting it back online, and we knew it was going to be a big job but we were just so excited to be there.”
That excitement was felt at the Park Grill, a family-owned restaurant located near Granite City Works. Fourth-generation owner Michael DeBruce estimated that about 40% of the restaurant’s earnings come from the mill’s employees or others tied to it in some capacity.
But “everything’s been in full throttle” since the restart, he said.
“It’s a positive thing. Definitely got a lot of guys back that I haven’t seen in a while. So it’s boosted everybody’s morale, and put us back where we were before it all went down,” DeBruce said.
Since the restart about a year ago, hundreds of people have gone back to work at the mill, including 600 brand new employees, Simmons said. Business is also picking back up around town.
Cathy Hamilton, the city’s economic development director, said industry remains at the heart of the city’s economy. Granite City has been industrial for over 100 years, and that isn’t going to change – nothing will be able to recreate its proximity to the Mississippi River or the rail and other infrastructure that has been built to support industry, she noted.
“The future of Granite City continues to be industrial. … We definitely have the temperature and continue to fluctuate as the success of the mill happens. It will never change that way,” Hamilton said. “It’s a steel town, and continues to be, and it’s a proud steel town.”
Things are on the upswing in this steel town.
“Slowly, you’re seeing storefronts open back up again,” Faust said. “You’re seeing people buying cars again, you see more new cars in town, you really see the real estate market taking back off again. You used to see tons of homes for sale, now the inventory is falling and prices are going up. So that’s encouraging.”
Added Simmons: “Everybody is uplifted, and they couldn’t be any happier right now. At least, they’re getting some of their life back. They’re looking and we’re hoping that this will be sustainable and we can continue that.”
Meanwhile, the Kool Beanz Café just celebrated its fifth anniversary.
“We have a really solid community,” Arguelles said. “It’s a blue-collar town, we were built around the steel mill, but there’s a lot of really, really talented people here. A lot of talented people that come out of Granite City. So, we have a really solid foundation in our community of people.”
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Reposted from AAM
