When a solenoid is wound on soft iron, the magnetic field is very strong; but we cannot retain the magnetic property after the current is stopped. In such a situation, a solenoid is called an electromagnet. However, if we use a bar of steel instead soft iron, we can retain its magnetic properties even after the current is stopped. In other words, the bar of steel becomes a permanent magnet, but its magnetic strength is lesser than that of soft iron.

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It says that if you keep a soft iron bar inside a solenoid and pass electric current through it. The bar will get magnetic but when you switch off the current, the bar will lose magnetism. But if you use a steel bar in place of soft iron bar inside the solenoid, then on passing current it will get magnetized but on switching it off a part of the magnetizing field will be retained by the steel bar. Thus the bar magnet becomes a permanent magnet.

Since, the steel bar retains a part of the magnetizing field this is why the strength of the permanent magnet is lesser than the soft iron electromagnet which has the entire magnetizing field of the solenoid.