Corus has announced that it will cut 3,500 jobs across the UK and Netherlands.

Corus, Europe’s second biggest steel producer, has announced that it will cut 3,500 jobs across the UK and Netherlands.

Today (26 January 2009), the company launched a strategic initiative intended to enhance its competitiveness, expected to bring annual improvements in operating profit of more than £200 million.

The initiative focuses on three areas: divestments, asset restructuring and a company-wide efficiency and overhead review.

In the last quarter of 2008 Corus addressed the immediate effects of the economic downturn through a series of measures that are expected to yield about £600m in cash benefits in the six months to the end of March. 

This new initiative comprises some long-term plans that were already under consideration, but which have been brought forward as a result of the economic slowdown. 

It will also put 3,500 jobs at risk around the company as a whole – 2,500 in the UK and 1,000 in The Netherlands.

In a statement, Corus said: “The company will make every effort to achieve the job losses through voluntary redundancies, whilst retaining critical skills in the business.  A comprehensive range of redundancy packages and outplacement support services will be made available to those leaving the company.”

Corus CEO, Philippe Varin, said: “The structural changes we are proposing today have been carefully considered. They are essential for the future of the business.  The company will keep its focus on priority areas such as training, research and product development, which, together with today’s initiative, will ensure Corus is in the best possible shape to compete strongly in the future.”

The axe is falling hardest on South Wales where more than 1,000 jobs are being lost – including 600 workers at the hot strip mill in Llanwern, near Newport, where production will cease.

Corus is also changing the British Steel pension scheme, closing its final salary plan to new recruits.

A subsidiary of Tata Steel, Corus has annual revenues of more than £12 billion and crude steel production of about 20 million tonnes, and employs around 42,000 staff worldwide.

For more information, visit: www.corus.com