One year on: how has the blast furnaces closing affected Port Talbot?

On 30 September 2024, blast furnace 4 at the Port Talbot steelworks closed, ending over 100 years of primary steelmaking in the town. It will be replaced by an Electric Arc Furnace due to open by the end of 2027, which Tata hopes will return the company to financial sustainability, and will reduce carbon emissions at the steelworks by 90%. However, the approach taken by Tata has resulted in thousands of job losses, both at Tata and in the supply chain.

A year on, we take a look at the key developments since the blast furnace closure, how the workforce and community have been affected, and the work of the Tata Steel Transition Board to support them.

What are the key developments over the last year?

What do we know about the impact of large-scale job losses on the workforce and local community?

Previous large-scale steel job losses have had considerable economic and social impacts. Work undertaken by academics at the University of Leeds following mass redundancies in the Welsh steel industry in the early 2000s found affected steelworkers faced “significant, structural barriers to employment transitions” and that the redundancies also resulted in negative impacts in areas such as health and housing. Dr Calvin Jones estimates the job losses at Port Talbot could lead to the town losing around £200 million in earnings per year, almost 15% of the town’s gross earnings.

The UK Government says there has “not been a spike in local unemployment levels since September 2024”, with data from the Office for National Statistics (ONS) showing relatively constant unemployment and claimant count rates. That said, academics from Sheffield Hallam University argue that unemployment figures have long excluded the ‘hidden unemployed’, who receive incapacity-related benefits and are therefore classed as economically inactive, and have done so since the closure of the coalfields in the 1980s.

The latest ONS data shows payroll employment in Neath Port Talbot has decreased since the end of 2023, while the Annual Population Survey suggests the employment rate may have decreased, although more reliable data is needed for a more conclusive view. In short, we don’t yet fully understand the economic impacts of the blast furnace closures on the local area.

A recent survey by Public Health Wales found that local communities are “rallying round to support each other” following the job losses at Port Talbot. However, 74% of households expect to experience financial pressures over the next six months with only 32% aware of available financial support, and 89% anticipate fewer employment opportunities in the local area.

What government support has been provided, and what impact has it had so far?

The Tata Steel Transition Board has allocated the £80 million UK Government funding it received to support people, businesses and communities affected by the transition. The money has been spent on:

• Support for affected workers and supply chain firms (£30 million);
• Funding to assist new and existing businesses (£13 million);
• Supporting economic regeneration projects in Port Talbot to support decarbonisation of industry (£8.2 million), net-zero skills, advanced manufacturing, and creating new business premises (£21.2 million);
• An Economic Growth and Investment Fund (£6.7 million UK Government funding and £5 million from Tata); and
• Additional mental health and wellbeing funding (£3.3 million).

The Welsh Government has also provided support, including through employability support programmes, targeted Personal Learning Accounts for Tata workers, and business support. It has also funded the Community Support Centre, which provides support, guidance and retraining advice.

The UK Government recently published information on the impact of the Transition Board funding. As of 4 September 2025:

• Employment and skills funding has supported 3,667 training courses and qualifications.
• Supply chain support has provided grants to 37 businesses, safeguarding almost 200 jobs.
• Business support funding has supported the creation of 22 new firms, with 43 businesses receiving growth and resilience funding.
• Neath Port Talbot County Borough Council’s employability support team has supported 332 people into new jobs.
• Nearly 600 Tata employees who were at risk of compulsory redundancy have been offered alternative opportunities at Tata.

In April 2025 the UK Parliament passed emergency legislation so the UK Government could ensure continued production at British Steel’s Scunthorpe steelworks. Concerns were expressed by some Members of the Senedd that the UK Government had treated the steelworks at Port Talbot differently to Scunthorpe. The First Minister responded that she considered the two situations were different, although she understood why people in Port Talbot were frustrated. She subsequently wrote to the UK Government calling for a “significant” amount of the £2.5 billion UK Government funding allocated to steel (which is additional to the £500 million funding for Tata) to be ringfenced to benefit Wales.

What lessons can be learnt from the transition, and what are the potential future economic opportunities for Port Talbot?

The Climate Change Committee, an independent body which advises the UK and devolved governments on climate change, has said there are “important lessons to learn from the way in which the closure of the blast furnaces was managed”. They said the UK and Welsh governments should have developed a proactive transition plan, including supporting alternative employment in advance of the blast furnaces closing.

The UK Government is currently developing its steel strategy, which is due to be published later this year. The UK Government has also announced it will increase energy price support for energy-intensive industries such as steel by increasing the discount they receive on electricity network charges from 60% to 90%, although UK Steel has called for further support.

The TUC has called for investment and an industrial strategy to “bring good jobs back to Port Talbot”, through future expansions in green steelmaking and anchoring local supply chains for offshore wind and other low-carbon infrastructure.

The Crown Estate recently announced preferred bidders for the first two floating offshore windfarms in the Celtic Sea. These will work with ports to support offshore wind turbine assembly, with Port Talbot and Bristol identified as likely locations for this. The First Minister has said the Welsh Government will work with employers to maximise the number of jobs for Wales. The UK Government has also announced that £80 million will be allocated to support floating offshore wind deployment at the Port of Port Talbot, subject to final due diligence.

The final business case for the Celtic Freeport, based at Port Talbot and Milford Haven and looking to support up to 11,500 jobs, has now been approved by the UK and Welsh governments. The freeport is now open for business, and funding will be unlocked once the two governments sign a memorandum of understanding.

What’s next?

The past year has seen considerable change in Port Talbot, and concerns have been expressed at how the closure of the blast furnaces was managed. How effective the support provided by the UK and Welsh governments is at helping those who have lost their jobs back into work, and at securing investment that delivers well-paid jobs locally, will be key to addressing the challenges the local community faces.

The Senedd’s Economy, Trade and Rural Affairs Committee will shortly be starting further work on the future of the steel industry, commencing on 9 October.

Article by Gareth Thomas, Senedd Research, Welsh Parliament