It will soon be a year since Nippon Steel officially acquired all that was left of U.S. Steel. The corporate name persists, but there is no longer any publicly traded stock for the company that made up the blue chip core of the Dow Jones Industrial Average for a century. U.S. Steel exists, but only as a wholly owned subsidiary of a global steel maker with a headquarters as distant as possible from Pittsburgh. 

What the acquisition means for Pittsburgh and the steel communities of the Mon Valley remains a very open question.

Unchanged, so far, is the region’s failure across so many levels to address the economic collapse of the communities of the Mon Valley. Now four decades since the contraction of the regional steel industry, these communities have seen minimal redevelopment, and remain virtually trapped in an economic morass. Braddock remains the poorest community in all of Pennsylvania, indeed one of the poorest communities in the United States. Duquesne is not far behind and remains a community unable to sustain a high school for its students. Divorced from broader regional narratives, little new industry or postindustrial shift has come to Clairton or similar Mon Valley communities once wholly dependent on the steel industry.

Editor’s note: On Monday, U.S. Steel and Nippon detailed some of their investment plans for the Mon Valley Works, which includes its mills in Braddock, Clairton and West Mifflin.

Parts of my recent book “Beyond Steel: Pittsburgh and the Economics of Transformation” were first drafted a decade ago, and my goal was never to chase headlines which are typically fleeting and soon forgotten. Nonetheless, if the production timeline of the book had extended barely another month, I would have felt compelled to write an epilogue focused on the almost inconceivable fate of U.S. Steel.

Because while Nippon’s purchase hasn’t altered the local economy, it brought or revealed changes in the region’s labor union dynamics, politics and attitude toward globalization.

From sledgehammers to support

I grew up in a period when it was not uncommon for laid-off Pittsburgh workers at demonstrations to take sledgehammers to Japanese cars in visceral protest to the perceived unfairness of imports into the U.S. The imported cars absorbed the brunt of emotional anguish generated by the existential levels of job destruction that were tearing apart the economic futures of workers, families and an entire region.

The painful truth is that the legacy companies of the American steel industry had been vastly outcompeted by not just foreign, but domestic firms for decades before waves of job destruction arrived in Pittsburgh. By the beginning of the 1980s, even the newest parts of the steel industry in Southwestern Pennsylvania were woefully obsolete compared to newer plants elsewhere in the U.S. – many located in regions that had no history in steel production or heavy industry of any kind.

What would have been difficult to believe in 1982, when job destruction and the official unemployment rate across Southwestern Pennsylvania peaked, was that decades into the future Nippon Steel would acquire the once-monolithic conglomerate J.P. Morgan created and called U.S. Steel. What would have been truly inconceivable was that acquisition would be welcomed by local steel workers and the leaders of local steel communities.

The end of U.S. Steel as an independent steel producer simultaneously generated debates at local, national and even international levels. Most surprising was that these debates precipitated a rare split between national and local union leaders. Whereas national leaders of the United Steelworkers Union vehemently opposed U.S. Steel’s acquisition by Nippon – much preferring the firm to be acquired by its domestic competitor Cleveland Cliffs – local union leaders and a range of local community members in Braddock, Clairton and West Mifflin stubbornly supported Nippon Steel’s bid.

Local support for Nippon Steel made a certain sense. The rationale was that Nippon had the assets and intention to reinvest in local plants, thus giving the best chance to preserve local jobs in the Mon Valley. The steel communities of the Mon Valley have been virtually abandoned over decades. Lacking any real hope of redevelopment in their communities, they remain focused on retaining the remaining steel jobs these plants provide.

A man in an orange safety jacket speaks at a podium labeled "U. S. S." with workers in hard hats and safety gear standing behind him at an industrial site.
David B. Burritt, president and CEO of U.S. Steel Corp., speaks during a press conference at U.S. Steel’s Mon Valley Works – Edgar Thomson Plant during a visit marking the one-year anniversary of U. S. Steel’s partnership with Nippon Steel on June 8, in Braddock. Burritt doubled down on the company’s planned investment in the Mon Valley Works. (Photo by Stephanie Strasburg/Pittsburgh’s Public Source)

It remains far from clear what investment Nippon Steel will make in local plants. 

Announcements thus far indicate a new slag recycling facility and a new hot strip mill in Braddock, possibly shifting work from the Irvin Works in West Mifflin. These investments will extend operations into the future, but are far from transformative to the region’s industrial ecosystem.

More may come, but the limited investments announced to date only reinforce a basic truth: There will be no return to industrial dominance for the Mon Valley. 

Nippon has already announced investments to build an entirely new, modern direct reduced iron mill in Arkansas, has committed to $550 million in improvements in Gary, Indiana and restarted a blast furnace in Granite City, Illinois. Competing firms, including Nucor, are on the verge of opening new plants in places including southern West Virginia.

If anything, Nippon leaders may feel a sense of buyer’s remorse at acquiring whole the legacy operations of U.S. Steel. Just a few months after their purchase was consummated, an explosion at Clairton resulted in two deaths, but also limited output for much of the next six months. Constrained by politics, the company may keep the Mon Valley plants in operation, but their competitiveness in a national and global steel industry remains as challenged as it was before.

No matter the length of time steel production persists in the Mon Valley, the communities that host these industries are owed a re-visioning of their futures. Individually and collectively, their viability as places to live and work will depend on transformation and investment far beyond what Nippon Steel can ever be expected to provide. Remaining focused on the past will only defer change that will eventually come, much as it did for the bulk of Pittsburgh’s once-vast steel economy.

Christopher Briem is a regional economist with the University Center for Social and Urban Research (UCSUR) at the University of Pittsburgh. He is the author of “Beyond Steel – Pittsburgh and the Economics of Transformation,” published earlier this year by the Kent State University Press, and can be reached at cbriem@gmail.com.

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