House prices dive, food bank use is up as latest mining bust hits Labrador town – by Sue Bailey (Canadian Press/Brandon Sun – February 4, 2015)

ST. JOHN’S, N.L. – Jason Penney knows the highs and lows of a miner’s life in Wabush, N.L., a one-industry town where the price of iron ore is discussed like the weather. But he says the community of 1,900 has reeled since its main employer shut down last year.

“We’ve never seen it quite this bad,” the president of United Steelworkers Local 6285 said from the office he now occupies alone. An administrative assistant and a safety officer were both let go along with about 500 other workers who lost their jobs when the Wabush iron ore mine closed.

Cleveland-based Cliffs Natural Resources Inc. blamed high production costs and nose-diving commodity prices as demand from prime steel buyers, such as China, waned. The company also confirmed last month that it had stopped production at its Bloom Lake mine in Quebec, about a half-hour drive from Wabush.

Penney said the move affects another 500 workers who flew in and out. For Wabush and nearby Labrador City, which bills itself as the iron ore capital of Canada, it means a loss of crucial spinoff and service jobs.

It’s all adding up to one of the most resounding busts ever for the region, Penney said. “There’s been a lot of people in sad, tough times. It was a rough Christmas on a lot of families.

“We’ve had some people who lost their houses here in the area. And unfortunately, the worst is yet to come.” Employment insurance runs out for many of the Wabush miners in the next month, Penney said.

Over the last three years, younger workers who landed jobs earning at least $50 an hour also bought houses at the height of the latest boom. They’re now saddled with mortgages worth more than collapsing property values, said Tammy Elliott, owner of Big Land Realty.

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