Magazine article Economic Trends
The Domestic Steel Industry
President Bush's December decision to eliminate the Section 201 steel tariffs on various carbon and alloy steel products refocused national interest on the domestic steel industry. Over the past three years, more than 30 U.S. steel companies have filed for bankruptcy and many more have consolidated significantly. Steel production directly affects the economy of our region, which is home to the nation's three largest integrated domestic steel producers: ISG (the former LTV Steel Corporation), U.S. Steel, and AK Steel.
Within the U.S., nine states derived more than $5 billion of gross state product from the primary metal and fabricated metal industries in 2001. Two of the nine, Ohio and Pennsylvania, fall within the Fourth Federal Reserve District, with significant earnings from these industries concentrated in northeast Ohio and western Pennsylvania.
Both of these states have experienced declines in employment throughout the primary metal and fabricated metal manufacturing industries, like the U.S. as a whole. The accelerated employment decline in the region's metal industries over the past three years results partly from surging steel company bankruptcies since 2000 and ongoing consolidation of steel production and distribution channels.
Nationally, total raw steel production, about one-fifth of which originates in the Fourth District, remains significantly below 2000 production levels. Although raw steel production in the Lake Erie region increased slightly in 2003, the Fourth District as a whole is still below its production levels of the 1990s and early 2000. However, activity in the domestic steel industry has recently increased somewhat. …