Middle Class Job Losses Batter Economy

AP Middle-Class Job Losses Batter Workforce Sunday January 1, 8:53 pm ET By Kathy Barks Hoffman, Associated Press Writer Middle-Class Job Losses Batter Workforce As Companies Slash Payrolls, Send Jobs Overseas

LANSING, Mich. (AP) -- Thirty years ago, Dan Fairbanks looked at the jobs he could get with his college degree and what he could make working the line at General Motors Corp., and decided the GM job looked better.

He still thinks he made the right choice. But with GM planning to end production of the Chevrolet SSR and shut down the Lansing Craft Centre where he works sometime in mid-2006, Fairbanks faces an uncertain future.

"Back when I hired in at General Motors 30 years ago, it seemed like a good, secure job," said Fairbanks, president since June of UAW Local 1618. Since then, "I've seen good times and I've seen bad times. This qualifies as a bad time, in more ways than one."

Many of the country's manufacturing workers are caught in a worldwide economic shift that is forcing companies to slash payrolls or send jobs elsewhere, leaving workers to wonder if their way of life is disappearing.

The trend in the manufacturing sector toward lower pay, fewer benefits and fewer jobs is alarming many of them.

"They end up paying more of their health care and they end up with lousier pensions -- if they keep one at all," says Michigan AFL-CIO President Mark Gaffney. As wages and benefits drop, "it's the working class that's paying the price."

West Virginia steelworkers are all too familiar with the problem. The former Weirton Steel Corp., which 20 years ago had some 13,000 employees, today has just 1,300 union workers left on the job.

The steel mill has changed hands twice in two years, and just last month, Mittal Steel Co. told the Independent Steelworkers Union it would permanently cut the jobs of 800 people who'd been laid off since summer.

Larry Keister, 50, of Weirton, W.Va., has 31 years in the mill that his father and brothers all joined. His son tried, but got laid off quickly.

"I'm too old to go back to school. I've worked there all my life," says Keister, who drives a buggy in the tin mill. "I went there straight out of high school. It's all I know."

Though Keister is safe for now from layoffs, he wonders what will happen to the hundreds of friends and co-workers who will be jobless by the end of January.M

Gary Colflesh, 56, of Bloomingdale, Ohio, said there are few jobs in nearby Ohio or Pennsylvania for workers to move to.

"They're destroying the working class. Why can't people see this?" asked the 38-year veteran. "Anybody who works in manufacturing has no future in this country, unless you want to work for wages they get in China."

Abby Abdo, 52, of Weirton, said workers once believed that if they accepted pay cuts and shunned strikes, they would keep their jobs. Not anymore.

"Once they get what they want, they kick us to the curb," he said. "There's no guarantee anymore. No pensions. No health care. No job security. We have none of those things anymore."

Fairbanks of the Lansing GM plant said the changes are going to force a lot of people to retrench to deal with the new economic reality. For some, it will make it harder to send their children to college or be able to retire when they want. For others, it will mean giving up some of the trappings a comfortable income can bring.

"You're going to see lake property, you're going to see boats, you're going to see motorcycles hit the market," he said. "People get rid of the toys."

Economists agree the outlook is changing for workers who moved from high school to good-paying factory jobs two and three decades ago, or for those seeking that lifestyle now.

"It was possible for people with a high school education to get a job that paid $75,000 to $100,000 and six weeks of paid vacation. Those jobs are disappearing," says Patrick Anderson of Anderson Economic Group in East Lansing, Mich. "The ... low-skill, upper-middle-class way of life is in danger."

General Motors Corp. has announced that it plans to cut 30,000 hourly jobs by 2008. Ford Motor Co. is scheduled to announce plant closings and layoffs in January that could affect at least 15,000 workers in the United States and Mexico, analysts say, and is cutting thousands from its white-collar work force.

GM and Ford have won concessions from the United Auto Workers that will require active and retired workers to pick up more of their health care costs, and DaimlerChrysler AG is seeking similar concessions.

Thomas Klier, senior economist with the Federal Reserve Bank of Chicago, says the transition for manufacturers toward leaner, lower-cost operations has been going on for some time. But the bankruptcy of the nation's largest auto supplier, Delphi Corp., pushed the issue into the headlines.

Its 34,000 hourly U.S. workers could see their pay cut from $27 an hour to less than half of that, although the company is still trying to work out a compromise unions will support. Workers also could have to pay health care deductibles for the first time and lose their dental and vision care coverage.

Delphi worker Michael Balls of Saginaw, Mich., hears the argument that U.S. companies' costs are too high to compete with plants that pay workers less overseas, but he doesn't buy it.

"I think if Delphi wins, they lose," he says. "If I'm making $9 an hour, I'm not making enough to buy vehicles."

Unfortunately for workers like Balls, the old rules no longer apply in the new global economy, says John Austin, a senior fellow with the Washington-based Brookings Institute.

"We're in a different ball game now," Austin says. "We're going to be shedding a lot of the low-education manufacturing jobs."

Some of those workers are likely to try to move into the growing service sector, Austin says. But he says the transition can be tough, even if the jobs pay as well as the ones they had -- and many don't.

"Pointing out a medical technician job is available if they go back and get a certificate doesn't solve the issue today for those 45-year-olds who are losing their jobs at Delphi," he said.

Dick Posthumus, a partner in an office furniture system manufacturing company in Grand Rapids, Mich., says that "basic, unskilled manufacturing is going to be done in China, India, places like that because we are in a global world, and there's nothing anyone can do about that."

His company, Compatico Inc., buys much of its basic parts from South Korea, Taiwan, Canada and China, where Posthumus has toured plants he says rival modern manufacturing plants in the U.S. But the company still saves its sophisticated parts-making and assembly for its Michigan plant.

"The manufacturing of tomorrow is going to look somewhat different from the manufacturing of yesterday," Posthumus says. "It doesn't mean that we no longer manufacture ... (But) it's going to be a painful adjustment."

Associated Press Writer Vicki Smith in Morgantown, W.Va., contributed to this story.

They are probably on welfare, however, so you're notion that these disruptions are without cost to you, is likely mistaken.

Notions of welfare as some sort of "dole" that exists in perpetuity are extremely outdated. The US government does not, regardless of the claims of uninformed doomsayers, provide one without employment with some weekly, monthly, or annual payment to sustain a standard of living. If you drop out, you eat out of a dumpster eventually. Gainfully employed individuals (or others possessing even an iota of skill and intelligence) do not "stop seeking work".

One may not, in our socio/economic system, simply choose to go without working and not pay a crippling price. I went to Target the other day to buy a small appliance. The store was plastered with "Now Hiring" signs. This country was built on men (and women) who would gladly work those hours in Target (as opposed to those hours on Wall Street) if only to maintain a sense of dignity and purpose.

If your work isn't worth any more than the pay the Chinese worker gets, upon what basis should I and others pay you more? 1. USA worker Mr. Smith is paying income taxes that in part pay for services you recieve, including the US Army which in turn protects you from takeover by hostile nations, including Mr. Wong's China. 2. Mr. Smith is paying into the SSI system, and supporting the existing recipients of those systems, which may include you or your relatives. 3. Mr. Smith's employer is burdened with following regulations that prevent pollution, which makes for a clean environment which you enjoy. Mr. Wongs industry is probably spewing toxins into the environment - but it is far away. 4. Mr. Smith and his employer pay for unemployment insurance, which is a government mandated social program. 5. Mr. Smith, if he makes a decent wage, will spend money on things that will continue to grow the economy. Money sent to pay Mr. Wong is unlikely to benefit anyone in the USA anytime soon. In summary we are a world of nation states. Attempts to avoid this fact by using strict Randian style libertarian logic overlooks some pretty obvious facts. Economic power (of other countries) over the USA is not a plus for American citizens as a whole.

"It is when doing so undermines your countrymen. That's kindof obvious, isn't it.. I mean, it goes without saying that selling secrets isn't treason either, until it extends to subversive activity, then you can hang for it. Amazing how that works isn't it. And the American public can be pretty fickle about treason. Some they imprison, some they deport, some they hang, shoot or even electrocute"

I've followed your posts throughout the whole thread. You've become increasingly bitter throughout. Here, you cross the line. What you call treason, reasonable men call freedom.

The capitalism and profits that you rail about is what finances this country, its democracy, and it's freedoms.

Free people pursuing their self-interest make this country great. I'm sorry that you are unable or unwilling to pursue your self-interest.

That other people can and do does not make them guilty of treason, even should they do so in a manner that you do not approve of.

The only part of the post you mentioned that I added to, was the fact that most all the tooling, machines, and engineering comes from Japan.

I was a tooling manager at an automotive supplier plant that did produce parts for Toyota and Honda, but nearly ALL of the tooling is shipped in from Japan.

The wholely Japanese owned plants buy all their machines in Japan also, they often send the skilled tradesmen from their plants here to Japan for training on repairing them.

If they have a choice, they will purchase everything from other Japanese firms.

Personally, you may be in high demand. That doesn't protect your position. The moment someone in China comes available, you will be expendable no matter how valuable you think your position is.

Havoc, that's the point!!! We're not sitting around waiting for some Chinese ne'er do well to catch up with us. That's why we like competition. We will win. Those who think everyone else controls their lives will lose. Sorry.

gain career training that is enabling and empowering in the workplace.

If you want to empower the workforce then drop the average home price to around $30,000 and reduce the average health care cost to sub-$500 a year. That means no more torts, no more HMOs, no more health insurance, no more Medicaid, Medicare, drug plans, Student loans, FDIC, FDA, or Federal mortgage guarantees. We have so many subsidies propping up favored broken industries that they are no longer able to adjust to the realities of the market place. Labor is the lease of our problems, and it only reflects the realities of a broken business environment. Let these bloated edifices to our service economy crash and use the airspace to build a more balanced and healthy economy. Why are average Americans incurring hospital expenses that can be 10 times their average earning; how, does an economy with an average family income in the 30s produce average homes that sell above a half-million? How can any of this be sustainable?

"I think if Delphi wins, they lose," he says. "If I'm making $9 an hour, I'm not making enough to buy vehicles." Unfortunately for workers like Balls, the old rules no longer apply in the new global economy, says John Austin, a senior fellow with the Washington-based Brookings Institute.

Free trade bump!

"The manufacturing of tomorrow is going to look somewhat different from the manufacturing of yesterday," Posthumus says. "It doesn't mean that we no longer manufacture ...

If it's not done in the USA, then that's exactly what it means. At any time the host nation can take control of their businesses. The USA may have bought the "global economy" line, but other nations haven't.

They sell their products cheap in the US , but charge much more in their own countries... we can not sell in their markets-totally unfair.

So, because they want to sell us cheap goods we should refuse? We should say, no fair, charge us more? We sell drugs in other countries more cheaply than we sell them here. Is that more unfair to Americans or more unfair to the foreigners? Any particular goods you want us to pay more for?

Steel prices have gone up tremendously in the last few years because our foreign masters always raise the prices after they destroy the competition.

You have any proof our companies have been destroyed and then prices were unfairly raised? Last time I checked we still produced a lot of steel in America. Maybe you have more recent numbers?

Did those sneaky foreigners jack up the prices after they drove American TV makers under? Or do TVs sell for less than ever? How about VCRs? Stereos? Computers? Or are you just making stuff up?

"It was possible for people with a high school education to get a job that paid $75,000 to $100,000 and six weeks of paid vacation. Those jobs are disappearing,"

Low skilled worker's unions killed the golden goose and now they are going to have to give up the second house on the lake and the six weeks vacations.

No, I was just highlighting the fact that many sleep in the beds that they make, and/or are unwilling to adapt to changes.

Please note that workforce investment, goals 2000 are all socialistic programs developed to meet a need. That need is a monstrous hybrid of socialism and corporatist fascism to produce a workforce, not educate enlightened individuals to make responsible and well reasoned choices about their lives and careers. Going through these job mills and career re-education camps effectively induces you into giving your career over to the government. They train you for what they think the economy will need --its all just centralized planning in the model of the soviet union. And don't think they are right in predicting what careers are needed. In my area they still train people computer jobs that went overseas years ago. When these people fail to get jobs in their new careers, more welfare money is available through "free trade" agreements. This gives the government full reign to keep their ruinous "free trade" system alive.

Globalization, outsourcing and offshoring are part of the engine to eliminate individual choice and self determination in America. Workforce Investment was entirely brokered to support the loss of jobs through "free trade" and to better control individuals to conform to the globalist view of economics.

Notions of welfare as some sort of "dole" that exists in perpetuity are extremely outdated

Sorry to say, you are ignorant of the unregenerate welfare state still extant. The welfare reform act was never fully implemented in a slew of states. There was too much discretion.

This is insane.

I remember that when Lafayette sent George Washington the keys to the Bastille, Washington proudly sent Lafayette a pair of shoe buckles made in the USA.

Washington wisely wanted to break the dependence on England for manufactured goods.

The majority of our population is only inherently smart enough to work with their hands.

Not to mention that even some smarter people are happier and more fulfilled working with their hands.

And not to mention that the restoration of America's industrial base and independence from the rest of the world should be a matter of national security.

"You can exchange and profit from your investment so long as you operate by the rules; and those rules are subject to political winds.

So, you admit that the rules you favor are based upon whim and the power of the bully-boys to enforce them at the point of a gun. My rules are based upon the ethics of self-determination and freedom. I have Jefferson and Madison on my side. Who have you got?

Unions, long ago, killed off most of American manufacturing.

And FWIW, at no other time in this nation's history, have so many people owned their own homes, had so many things, and enjoyed as much free time. People who keep talking about some long lost "GOLDEN AGE", here, either have memory problems and/or don't know any accurate history.

When Washington gave Lafayette those buckles, the vast majority of Americans were farmers, most people made their own clothes, and there was still slavery. Abigale Adams begged her husband, in letters, to try to get her pins ( for sewing ) from Europe. They weren't made in America.

And America has been buying "cheap goods", which were NOT made in America, for many, many, MANY generations; this is nothing new.

"Good, I'll be right over to hog tie you, prostrate you on the ground with 200 pounds on your back and then race you 100 yards for everything you own. If you can't compete, no fair whining about it. Oops, didn't say anything about fairness or a level playing field did we.. how obtuse of you. lost that one. wanna just mail me my winnings, or are you going to put up a fight now that you'll want to specify a fair fight..."

Come on over Havoc but I warn you, I compete pretty well. If it's the jungle you favor I can win there too but in the country I live in there are rules, just as few as possible. Assault and battery and theft are illegal. Also please note, no one ever guaranteed you that the plan you made 30 years ago was good for all time. If you want to live in the world, deal with change. If you can't deal with change fall behind and lose. You choice but you're not the only one who gets to make it.

Well, I agree with you as so far as these Federal programs, but the demise of our manufacturing comes from artificial wage hikes from Unions, Unions blocking advances in manufacturing to maintain status quo, rising health care costs due to runaway lawsuits and a over medicated populace, costs incurred from EPA, OSHA, and other regulatory arms, etc. etc. All of these need to be purged, and then we can compete through efficiency and intellect.

You can't lock yourself in the closet and pretend that there is not a global economy, and that, in many ways, it is beneficial to us as well. Your view of globalization and free trade is conspiratorial, I think it boils down to pure dollars.

As far as education goes, it is out there to be had in whatever form you choose, but one must be motivated to go get it and shell out the cash. As seen in this article, many otherwise intelligent Americans choose the path of least resistance and immediate gratification. Then when the rug gets pulled out from under them, they look surprised.

My rules are based upon the ethics of self-determination and freedom.

Yada-yada-yada- if someone were to walk into your home today and decide that they had the freedom to partake of your property, you wouldn't hesistate for a minute to call out the hired guns. Where would your commitment to freedom and self determination be at that point? Property is a fiction created to support and encourage a capitalistic system; but, should that system fail, you have no more substantial a claim to that property then a worker has for a job. Those who forget that will usually live to regret it.

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