the “scrap grubbers” who make the waste industry far more industrious than it is wasteful.
Can it is be discarded here?
If yes, will this make the sentence less natural or counter to normal usage?
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First, I need to point out that this isn't a sentence. Drop the "who" to make the sentence about the "scrap grubbers." Keeping the who means this is all, essentially, the subject of the sentence.
But, yes, you can drop "it is" without any change in meaning. If you drop the "who" to make this a sentence, "it is" fits equally well as simply dropping dropping "it is". On the other hand, if you keep this as a sentence fragment and add on a predicate, the "it is" sounds a little awkward to me but it's still understandable.
In the first case, I think they are equally natural and up to preference. In the second case, I think "it is" is a bit awkward. I think it's because of the verbs. In the first case, the implication seems to be that the scrap grubbers preclude wastefulness in the industry so you wouldn't say "it is wasteful". In the second case, it seems more like a defensive statement where you're not necessarily denying the wastefulness.