Pennsylvania’s steel industry faced significant challenges this year as federal decisions threatened operations at two major companies: Cleveland-Cliffs and U.S. Steel. While Gov. Josh Shapiro joined bipartisan efforts to protect Cleveland-Cliffs’ Butler County plant, his neutrality on the U.S. Steel merger has drawn criticism from state lawmakers and workers.
The Cleveland-Cliffs facility, the nation’s sole producer of grain-oriented electrical steel, was at risk due to a proposed Department of Energy regulation favoring foreign-sourced amorphous metals. Shapiro, alongside lawmakers and union leaders, publicly lobbied the Biden administration to revise the rule, which was dropped in March. Shapiro hailed the success as a demonstration of bipartisan cooperation and commitment to protecting local jobs.
The situation with U.S. Steel, however, has been far more contentious. Japan-based Nippon Steel’s $14.9 billion offer to acquire U.S. Steel was blocked by the Biden administration in January, citing national security concerns. This decision halted what many viewed as a vital opportunity to modernize U.S. Steel’s aging southwestern Pennsylvania mills. The move sparked backlash from lawmakers and union leaders, with Senate President Pro Tempore Kim Ward urging Shapiro to take a more active role.
Without Nippon’s investment, U.S. Steel has warned that operations could shift to Arkansas, as seen in 2021 when delays in Allegheny County and state approvals led to the Mon Valley Works project moving south. Meanwhile, union leaders oppose Nippon’s bid, arguing the company would avoid collective bargaining agreements by relocating operations abroad.
Shapiro has remained neutral on the merger, with his office emphasizing his behind-the-scenes efforts to mediate discussions between Nippon and union leaders. Critics like Ward argue that Shapiro’s approach is insufficient, calling on him to support lawsuits filed by U.S. Steel and Nippon against the federal government. The lawsuits allege that political interference derailed the merger to favor Cleveland-Cliffs, which offered a significantly lower bid for U.S. Steel.
Ward highlighted Pennsylvania’s vulnerability to losing jobs to neighboring states, comparing the situation to FirstEnergy’s acquisition of West Penn Power, which led to job losses as operations shifted to Ohio. She accused Shapiro of failing to propose concrete solutions for steelmaking’s future in the state.
Shapiro’s office countered by reiterating the governor’s commitment to protecting Pennsylvania workers. Spokesman Manuel Bonder emphasized the complexity of U.S. Steel’s challenges compared to the clearer resolution achieved for Cleveland-Cliffs. He reassured workers that Shapiro remains focused on creating the best possible outcome for Pennsylvania’s steel industry.
As the fallout continues, steelworkers and lawmakers alike remain concerned about the uncertainty surrounding U.S. Steel’s future and the broader implications for Pennsylvania’s industrial base.
