The industry I am using as my example is the once booming British steel industry. The specific site I am using is that of Ravens Craig which is situated in Lanarkshire Scotland. The plant produced its last steel in 1992 closing and making over 12,000 workers unemployed. Its closure came unexpectedly just like one of the latest incidents which Llanwern steel works close in 1999 with the loss of over 10,000 workers. Many people have asked why Ravens Craig was closed. One of the biggest reason was British Steel becoming sold by the government and becoming a privately run company in 1986.
Due to British steel being sold by the government the whole industry faced redevelopment on both the production aspect and the business side. Ravens Craig was operating at a loss of revenue so seemed destined to face closure as the newly formed British steel chief executives seek ways to cut coasts of steel to production so they could compete with the Chinese and eastern European market. One of the reasons form the loss of turnover at Ravens Craig, was due to the fact that other countries like the ones I have already named, could produce steel at a fraction of which we could.
For example the Chinese, are able to run steel factories at a fraction of ours due to their labour force. The Chinese do not have a minimum wage policy, meaning the Chinese population will work for the bare minimum and will work shifts when they are told too, if not they could face server reprimand. Another advantage that foreign countries have on British steel, is the strength of there currency. For the last decade the British pound has been too high in the financial markets meaning, Ledc countries find it difficult to trade with Britain as do other Medc’s. Due to the pound being so strong, British companies have suffered with the loss of investors as there trading partners have sort after companies often in the third world where they can receive more goods for their investments.
British steel up until I went public were a force to be feared, just like, like the industries before them such as the coal industry, a huge decline hit them due to the fact that other countries have caught them up and have over taken them as there steel is easier and produced cheaper. Another reason why Corus have struggled is Globalisation. Raw materials also became dearer and dearer as they were forced to import more and more raw materials to make the steel due to the fact that the UK were no longer developing coal, iron ore or limestone as Britain had started to run out of these goods.
The Ravens Craig plant after closure has seen troubles in every aspect. One of the first problems was what to do with the 1000 acre site. Would it be just left as the world’s largest brown field or would it see mass development on taking business away form Glasgow. Still at the present day no development has been seen on the site due to the fact that government officials have still not declared the site safe enough for development. Thus meaning, harmful substances still exist in the soils that lay underneath the once formidable Ravens Craig steel works. On the ravens Craig site over ï¿½120m has been spent on new roads and power supplies. Although the European union provide half of this amount.
Stock piles of raw materials had to be disposed of carefully and slowly trying not to contaminate any more land. Also the river that ran through the site had to be treated and decontaminate, due to the fact that it was used to cool the steel down then carelessly dumped back into the river. This river being the South Calder. Soil also had to be removed as it contained layers upon layers of oil, metal, and blast furnace by products and asbestos. Over the last ten years a clean up operation has been in place to make the site re useable and now development seems likely to be given the green light in December of this year. The plans for the future at Ravens Craig were made by a Consortium made up of the following groups
> Wilson Bowden ( housing)
> Scottish Enterprise
> Lanarkshire county council
Between these four companies a business has been organised planning to bring up to 9,000 jobs to the area. Ideas have been put fourth for ideas of what can replace the ravens Craig site:
> Retail site over 1 million square feet
> A top of the range leisure facility
> Training facilities for those who have became unemployed since the closure of Ravens Craig
It is believed after the clean up it will take up to 20 years for the site to be fully developed. It will take this long due to the fact that planning permission must be achieved, developments must be finalised and building work must be organised. When building work does commence jobs were be created as many workers will find employment regenerating the site to create a modern day complex that caters for all aspects of life from education to employment.
Today Corus are facing even more problems this is shown in the closure of Llanwern. These problems when British steel merged with Hoogovens in 1999 forming Corus. When forming Corus these two companies thought they were creating the 3rd largest steel producer in the world. But ever since the day that Corus was formed job losses and production cost were slashed as British steel (a strong booming company despite plant closures) joint Hoogovens (largest steel producer in Holland but were crippled with debt). British steel were unable to find away to tackle there debt meaning, the company would be in decline like it is today.