Factory workers lose jobs as steel tariffs put business in "crisis mode"
Steel tariffs that went into effect the first week of June are causing a factory in Missouri to lay off dozens of workers due to lost business from cancelled customer orders.
At the MidContinent Steel and Wire plant in Poplar Bluff, Missouri, where Magnum Fasteners products are made, 60 employees were laid off this month as certain operations were idled due to lost business from increased steel costs.
Company in "crisis mode"
The company is the largest nail manufacturer in the U.S. and employs hundreds of people in Poplar Bluff. It is owned by Deacaro, a Mexico-headquartered firm which ships steel from its mills in Mexico into the U.S. for a variety of finished products. The administration's steel tariffs add a 25 percent penalty to the raw material.
"The imposition of these tariffs on our raw materials on June 1st has actually put our operations into a crisis mode," operations general manager Chris Pratt told KFVS in an interview.
One employee laid off last Monday said the layoffs could be a sign of bigger problems at the nail factory, KFVS reported.
Nearly half of orders cancelled
Pratt says their customers have canceled 50 percent of their orders because the price of their products have jumped since the steel tariffs started.
"The low priced import nails that we are having to compete with ... has forced our customers to start seeking products in those areas," Pratt said. "That means going away from the U.S.-manufactured product that supports our local industry and jobs."
Leaders at MidContinent Steel and Wire are pushing lawmakers in Missouri to help exclude their raw materials from the U.S. list of tariff targets. Companies have filed thousands of exclusion requests with the Commerce Department to have materials exempted. Last week, Commerce Department granted seven companies a total of 42 exclusion requests, and denied 56 steel exclusion requests from 11 other companies, explaining in a statement that "exclusions generally are granted if there is no domestic availability and there are no overriding national security concerns with regard to the specific product."
Jobs at stake
Steel and aluminum production jobs represent a small segment of the U.S. economy -- about 255,000 jobs in steel and 61,000 in aluminum, according to Moody's Investors Service.
Manufacturers and end users make up a much larger portion of the economy. That means tariffs on raw materials, combined with retaliation from angry trading partners, may end up causing more harm than good. An estimate from consulting firm Trade Partnership forecast about 400,000 U.S. jobs lost versus 26,000 created as a result of the metal tariffs.
CBS News' Jillian Harding contributed reporting.