West-Siberian Steel Works (ZapSib) and Novokuznetsk Iron and Steel Plant (NKMK), two Kemerovo region (Kuzbass)-based subsidiaries of the Russian steelmaker and iron ore producer Evraz Group (Evraz), may lay off about 1,000 people by the end of the current year, reads a statement issued by Russia's Kemerovo regional administration citing Kemerovo governor Aman Tuleev.
Accordingly, the workers who are to be dismissed will receive unprecedented measures of social support. The compensatory payments may range from Ruble 90,000 to Ruble 200,000 (about $3,000 and $6,654) per person, with a fund for the support of small business companies also to be created. Evraz and the Kemerovo administration are to contribute Ruble 300 million and Ruble 100 million (about $9.98 and $3.33 million) respectively to this fund, which will give a chance to laid-off workers to create their own businesses. In addition, Mr. Tuleev stated that measures for the employment of laid-off persons of working age at other big production facilities in Novokuznetsk city will be also taken.
As SteelOrbis previously reported, in the beginning of September this year, Evraz announced that due to the improved demand, accompanied by higher pricing, for steel products from its traditional international markets, particularly Southeast Asia, the Middle East and North Africa, from July 1 this year it has achieved full capacity utilization across its Russian operations, i.e., representing about 13.5 million mt of crude steel per year.
According to reports, in the first half of 2009 Evraz laid off about 3,900 workers at its Russian operations, and undertook measures to cut staff expenses by 32 percent in dollar terms, compared to the same period of last year.