More than 150 staff will accept half their previous wage in a bid to keep the firm in business

More than 150 workers at Lincolnshire steel firm Caparo Merchant Bar (CMB) are taking a 50% pay cut to help the company stay in business.

Staff at the Scunthorpe-based firm have also agreed to take an extended holiday over Christmas and the New Year.

When they return on 3 January after a longer than usual break, many will be earning half their previous wage.

Andy McGarrigle from the Community Trade Union said the workers hoped their sacrifice would help the firm ride out the recession.

He said: 鈥淲e do see this as a short-term problem, we鈥檙e hopeful that we can see the company through these difficulties and by working with the company we can hopefully come out in the new year and see the company begin to grow.

鈥淲e understand the economic realities and 鈥 the problems across the economy, across steel-making in particular. It is a difficult time.

鈥淚t鈥檚 not an easy decision to take but we鈥檝e got a strong business down there and we鈥檝e got some really high skilled workers.

鈥淚t鈥檚 in manufacturing, it鈥檚 in the private sector and these are the jobs that we need to take our economy out of the current difficulties.鈥

Labour MP for Scunthorpe Nic Dakin said: 鈥淭hese are very difficult times and 鈥 people understand that it鈥檚 far better to have a job at the moment and to work together with your employer to get through these difficulties than to find yourself without a job.

鈥淭hey鈥檙e working together to get through difficulties, which is a very sensible thing to do and I鈥檓 sure they鈥檒l get through.鈥