Around 50 jobs are set to be cut at the Kurri Kurri aluminium smelter as it struggles under a high Australian dollar, contract problems, the carbon tax, and falling aluminium prices.
The move, by Norwegian smelter owner Norsk Hydro, will see the facility cut its workforce by about ten per cent, according to the Newcastle Herald.
Staff and unions have raised fears that Norsk will no longer support losses at the smelter, however CEO Alberto Fabrini yesterday reassured employees.
"Kurri Kurri has the support of Hydro Primary Metal in Norway for the implementation of a broad spectrum of activities including operational efficiency and cost improvement, among others," he stated.
"Kurri Kurri is facing great challenges, hit by the strong Australian dollar and global aluminium prices.
The smelter has reportedly lost about $20 million in the last few years.
Fabrini went on to add that "management is working closely with the unions to develop an action plan that will help to guarantee the long-term sustainability of the smelter."
However, he did point to the carbon tax as a long term problem for the industry.
This downsizing has been part of a gradual workforce reduction at the facility from its 1980s heydays, where the workforce numbered around 1100.
It currently stands at just over 500.