Algoma Steel to lay off 1,000 workers in coming months, union says

SAULT STE. MARIE – Algoma Steel is laying off more than a third of its workforce as it accelerates a transition to new equipment in response to U.S. tariffs.

The company started issuing some 1,050 layoff notices Monday morning, said Bill Slater, president of United Steelworkers Local 2724, including about 150 to his members.

“There’s going to be a lot of transition for people and it won’t be a happy transition,” he said.

He said the size of the layoffs will also be hard for the whole city of Sault Ste. Marie, whose population is about 72,000.

“It’s a lot of people for a community our size,” said Slater.

Mike Da Prat, president of USW Local 2251, said 900 members of his union working at Algoma Steel will be laid off starting March.

He said the news has left workers anxious and stressed ahead of the holiday season.

“You can imagine what the mood is, right, it’s Dec. 1, they get this notice and Christmas is 25 days away,” he said.

The job cuts come as Algoma has accelerated plans to shut down its blast furnace and coke oven operations as it transitions to more efficient electricity-based steel production.

The plans have been in the works for years, but U.S. tariffs on steel pushed the company to move faster, said Slater.

“Some of the layoffs would have happened eventually with the [electric arc furnace] transition,” he said in a phone interview.

“But they would have been at least a year from now instead of now, so because of the tariffs, it shortened the time frame.”

Algoma did not respond to multiple requests for comment. 

The company reported almost half a billion dollars in losses last quarter as the 50 per cent tariffs on steel imposed by the U.S. effectively shut it out of the market.

It was while releasing its last results that the company said it was accelerating the transition to its electric arc furnace, which will give it more flexibility as it reorients production to focus on steel plate for the Canadian market. 

Prime Minister Mark Carney last week announced the federal government’s latest package of measures aiming to boost the domestic market for steel and lumber producers, including tighter quotas on foreign steel entering Canada and a promise to trim freight rates for interprovincial rail travel.

The federal and Ontario government have also provided Algoma with $500 million in financing to help support the company during the market turmoil. 

Finance Minister François-Philippe Champagne said the government has put a number of programs in place to support workers.

Speaking before question period in Ottawa Monday, he said work is underway to make sure all levels of government prioritize buy Canadian policies, along with other measures to make sure the steel industry survives in Canada.

“We need a strong steel industry in Canada.”

Struggles in the steel industry aren’t just because of tariffs as the global industry has been dealing with oversupply issues. 

On Monday, German giant ThyssenKrupp Steel said it had reached a deal with its union as the company looks to scale back production, and cut or outsource 11,000 jobs out of a workforce of some 26,000.

This report by The Canadian Press was first published Dec. 1, 2025.

— By Ian Bickis and Sharif Hassan in Toronto