Highly-Automated Austrian Steel Mill Only Needs 14 People

26 June 2017

Like the coal industry, the steel industry has gone through rapid changes over the last ten years. While there’s no doubt steel will continue to be a crucial part of many people’s daily lives, the question remains if any of those people will be involved in making that steel. Bloomberg takes a look at the Austrian steel industry, including a plant that needs just 14 employees to make 500,000 tons of robust steel wire a year.

The village of Leoben has long been an industrial suburb to the nearby Vienna, smelting iron has been in the region since the 1400s. A new mill from the German manufacturer Voestalpine is called “Voestalpine Stahl Donawitz” in honor of an earlier community in the area that merged into Leoben in the 1930’s. The mill is big, with a 2,297-foot production line. But, as Bloomberg notes, there’s barely anybody there. At most, there are three technicians monitoring the output on flat screens.

Former line workers, the three technicians spent three months studying for their new roles at the plant, learning about control systems and how to interpret the rush of data they receive in their “pulpit,” as it is called, above the grounds. The other 11 employees maintain equipment or retool the plant for various wire gauges.

“We have to forget steel as a core employer,” Wolfgang Eder, Voestalpine’s apparently very blunt CEO, tells Bloomberg. “In the long run we will lose most of the classic blue-collar workers, people doing the hot and dirty jobs in coking plants or around the blast furnaces. This will all be automated.”

For years now, Voestalpine has had a clear business strategy: Don’t try to compete with the major players in steel, like the Japanese Nippon Steel or the South Korean Posco. Rather, go for niche products like steel wire, which are used to make components such as shock absorbers and piston cases in cars. It’s a sentiment seen in manufacturing across the West, including companies like the San Francisco-based clothing company American Giant and Shinola, a Detroit-based watch maker.

Those two companies bake the idea of nationalism and history into their marketing, and a similar effect is playing out in the steel industry. The plants in the area once known as Donawitz would have employed 1,000 people; the place bearing their name employs fewer than twenty. Some suspect that President Trump will make steel the first protectionist trade stand of his presidency. But if the experience of Leoben and Donawitz show anything, it’s that the industry has radically shifted and will not be the major employer it was in the past.

Source: Bloomberg