Posted on 11/02/2003 2:14:31 PM PST by Willie Green
For education and discussion only. Not for commercial use.
Franklin Electric announced it's shutting down its Jonesboro factory, laying off all 77 workers over the next 14 months and sending their jobs to Mexico.
In nearby Marion, more bad news General Cable and Bell Packaging confirmed they too may close leaving another 350 jobs up in the air. Thomson, once the county's largest employer cuts its workforce in half.
Ironically, the news of continued hard times in Grant County comes amidst news of the nation's best economic growth in nearly 20 years.
Consumer spending is up considerably and thanks to low interest rates, so are home sales, but not in Grant County an area still heavily dependent on manufacturing.
The headlines here offer little encouragement to restaurant manager Denise Pavlick. She wonders how much her already economically stressed community can take.
Pavlick said, "Oh I want to cry just knowing 77 people in a small town like this, everyday something in Marion seems to be closing, it's just turning into a ghost town."
How about: Unskilled US workers are no longer worth $7.50 per hour in a bureaucratic, litigous, and sclerotic regulatory environment, but fortunately will still rapidly find new jobs available at their actual market value.
From their website: Franklin Electric is a global electric motor manufacturer with fifteen manufacturing / distribution facilities located in the United States, Germany, Czech Republic, Italy, Mexico, Australia, South Africa, China, and Japan.
What's really hard to imagine is why Franklin kept their Indiana facility open as long as they did....
I'd call it misleading.
The manufacture of electric motors requires skilled, not unskilled labor.
I doubt that you'd be qualified for many of the tasks involved.
Just a thought, but it's also possible that taxes, regulation, labor, education and tort issues are becoming a national problem that could be incenting businesses to move certain activities offshore.
They most likely chose Mexico to fabricate product for the US market with unskilled labor cheaper than what is available to them in the US.
Kudos to them for making the correct economic decision.
There are several other news articles on this non-competitive plant moving in which the employees note their own lack of skills.
http://www.chronicle-tribune.com/news/stories/20031031/localnews/553208.html
"We've got to get out of manufacturing," said Martin, who makes $7.65 an hour at Franklin and has worked at factories all her life. "It's gone in this state. The factory worker in Indiana is like a dinosaur. You're extinct, almost. We got to get out of it, get us an education so we can still live here."
Stephanie Hiland plans to go back to school to become a medical assistant. The 42-year-old, who has worked at Franklin for about a year, is devoted to this community. She grew up here. She just bought a house here.
"It makes me sad because this is my hometown," said Hiland, who graduated from Marion High School in 1979. After a 12-year stint in New Mexico, she and her family returned to Marion two years ago to look for work. Her husband manages a local liquor store.
"We're not going to be without dinner, but it's going to hurt," she said. "We tried to come back home to start over again. I couldn't speak at the meeting because I was afraid I was going to cry. I'm 42 years old. I don't have a college education.
Emphasis added by me.
Here's what the Grant County Chronicle-Tribune suggests.
This is what the county has to do:
Create a culture of learning, in which knowledge is viewed as central to health, happiness and prosperity.
Encourage and support innovation and entrepreneurship.
Create and sustain a quality of life that is attractive to globally competitive businesses and employees.
Easier said than done, of course. But it had better be done unless we want a county of ghost towns.
I couldn't agree more.
Conservatives need to stem the forces driving them away.
I disagree.
I have studied how companies make these decisions. Wages are just a part of it. There are other elements such as country risk, intellectual property protection and rule of law where America has a large advantage. If all other things were equal, the rate of offshore decisions would be dramatically diminished.
Describing 77 lost jobs in a town of over 30,000 people as DEVASTATING is ridiculous.
It may be interesting, or notable, but it is well less than one half of one percent of the total work-age population of the geography from which Franklin's employees are drawn. Plus the job losses are spread out over time, rather than sudden. On second thought, suggesting that a 0.5% temporary change in employment spread over time is DEVASTATING "to another small American community in the heartland." isn't actually misleading at all....it's just flat out false.
http://www.nilrr.org/rtwoutperform.htm
The state's corporate tax rate is relatively high at 8.5%
http://www.taxadmin.org/fta/rate/corp_inc.html
Compare that 8.5% to Kansas, a right to work state, with a 4.0% corporate tax rate.
As for the regulatory environment (environmental laws, tort law, education) in Grant County, the answers are rather complex. In short though, you can bet that Mexico has a better regulatory environment.
Of course tell that to the 10000 people that have lost their job in NC in the past six months within the textile and tobacco industry, both directly affected by globalism and national regulations set forth by the Senate, which BTW is controlled by Republicans
Jonesboro, Indiana Population (year 2000): 1,887
Get your facts straight.
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