Corus Steel workers are expected to take a pay cut due to the firm downsizing it's European output, it has emerged.

The company employs 25,000 workers, and fears the economic crisis has bitten the steel mill were compounded last month when 500 jobs were axed from its UK workforce.

It is unclear whether the pay cut is an alternative to further job losses or even to stave off the closure of some plants, according to a union official.

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Corus plans to reduce its European output by 30% by March fears are mounting that the Llanwern site in Newport, South Wales, will close as the company make further savings, costing 1,000 jobs.

The economic difficulties have effected the rate of new constructions in the UK, which in turn has effected the demand for steel.

A spokesman for the company said: "Tata Steel's European plants have moved quickly to align output with reduced demand. Last month Corus decided to reduce its liquid steel production in the October 2008-March 2009 period by 30%. To achieve this it has announced plans to temporarily idle one blast furnace at each of its Scunthorpe and Port Talbot plants in the UK."

Corus is the world's fifth largest steel producer

(DW)