NEWCASTLE - While 2,000 direct job cuts are looming in Newcastle, the jobs bloodbath has already begun for subcontractors.
Of the affected subcontractors is Elinem Construction, which has been operating in Newcastle for 26 years.
With the ArcelorMittal SA (AMSA) closures, Van Staden has decided to move the company more than 300 kilometres away to Richards Bay.
Over the last year, the company has shed at least 100 jobs, and the relocation is a dark reality for employees.
The Newcastle community and businesses alike are on tenterhooks.
The Trade, Industry and Competition Department is locked in meetings with AMSA management, trying to rescue the situation
The AMSA CEO says a number of issues, including transport costs, have led to the decision to halt its long steel production.
One economist sees economic stagnation as the heart of the problem.
An exodus from Newcastle is feared.
While those who can afford to relocate are weighing their options, many more who can't are hoping the government will save the desperately needed jobs here.