Posted on 01/02/2006 4:19:44 AM PST by ventana
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.
And only an unfettered marketplace will deliver demand to direct the creation of that industry and those jobs.
Short term fix. Many companies are starting to realize that for every one call to an American support person two or three are made to the overseas support person.
"And if you don't like calling India to service your Dell, stop buying their computers."
No, you end up not calling their support center AGAIN. Dell has pulled back from overseas support quite a bit due to complaints. People end up going for third party support.
I have no problem with business owners making a profit - particularly the business owners who risked their own capital and sweat to establish the business. But the problem today is that most CEOs are not the business owners and they run the company for Wall Street. Whatever they do, they cannot lose (golden parachute & huge comp package regardless).
What is missing is morality.
I think they guy who founded/runs Cosco is worthy of a hat tip.
Unions are a different thing altogether.
You're throwing a lot against the wall hoping something sticks. Simply put, I support freedom of choice. It was legal thirty years ago and even earlier. I hope it will be so thrity years hence
Nope. You don't get it. No one on this thread has so far, so don't feel alone.
You want to blame someone for "offshoring", etc.? Blame f**king Wall Street. Everything to corporate America...........EVERYTHING...............is "quarterly results". Forget long term growth plans, forget long term strategies, forget what makes sense for the long run............ALL anyone on the Street rewards is the latest "Quarterly Results".
In this age of Information RIGHT Bloody Now, it's the way businesses have evolved: week by week, month by month, quarter by quarter. Two, five, ten years from now.......where will these companies be?
Trust me when I tell you: no one gives a flying f**k.
Cut costs; offshore your talent. Cut benefits. Piss on your employees' legs and tell them it's raining. Try to make them proud to be a force in the "world economy". Wrap up the panic in homilies and platitudes. Make them smile while they're being slowly screwed......but they don't have much choice these days to stay competitive per The Rules of the Quarter.
I should know. I'm in worldwide marketing for a very, very, very large corporation that is a household name.
You get Wall Street and their ilk to change their perceptions of what are the right moves for listed companies, what comprises sound strategies, what REALLY to look for in companies........and you'll see a change. Otherwise, deal with it.
Funny.
I get no response (from the anti-overseas people) to the question of how many people have taken a vacation or holiday in a foreign country.
Because if you spend $5,000 on a vacation trip OUTSIDE the U.S., the entire amount (minus travel agent fees) goes to that foreign country.
On the other hand, if I buy a $20 (china made) toaster at Wal-Mart, $10 probably goes to Wal-Mart, $5 to the transportation company, and $5 to the foreign business which made the damn thing.
Likewise, since 60-percent of our energy is imported, each time we fill our vehicles with gasoline, (say.... $40 a fillup), then about half of that is going to a foreign company.
Financial things are not so simple.
All I know is that as U.S. citizens, we should have as many choices as possible.
In KY the coal business got bad and our lady governor pushed the idea that we should fall back on arts and crafts, corn shuck dolls and quilts and the such. She by the way was a Dem.
She gave this advise to men who had moved mountains.
Her one last claim to fame was swallowing the top of a coke bottle and damn near dying. There was some disappointment when she pulled thru.
THe whole thing is like a dog chasing its tail.
Isn't it crazy??? Like someone said, if your neighbors lose their jobs, it's a recession...If you lose your job, it's a depression...I know...
My job will be over in about March...The Chinese and Brazilians will do my job from now on...And my company was one of the last holdouts...All we have left is a paper mill and that one will likely be gone by the end of the year...
These people that sit in their little cubicles don't have a clue what's going on in the outside world except what they read in the WSJ...
I don't agree with you...I don't see why you should have the right to sell YOUR Chinese made junk to us American citizens without paying a price to us, just because you were born (and got your wealth) here, on the backs of American citizens...
And as I understand it, that was the position of the patriots that fought and died so you could be free to do business in 'this' country...
Precisely. We have met the 'enemy', and he is us.
Problem is........most of those whining about all this have NO clue as they watch their 401K's, etc. None.
Now.....with that said.......there is every reason to believe that if the major trading houses (Wall Street), analysts, etc. began to reward companies for proper long term planning, employee retention, etc., we'd see a major turnaround.
There is plenty of blame to go 'round here.
Gee if the Chinese are all working for "slave wages", how come the best seling car in Bejing is the VW Passat,with an adv. price of $31,000.00 ?
In this day and age, we should be offshoring our politicians who refuse to protect American workers.
Supply and demand, like some say? Big business demands slave labor, and Mexico and India supply it, and our "leaders" think this is great as they bow to their globalist masters.
No globalist will get my vote ever again.
My family was in the coal business till '85 got out due to low prices and overregulation. Even in the '70's and '80's coal was being imported with the US sitting on the largest coal reserves in the world. Made no sense then and less now. By the way, we small operators always knew that the regs were designed to make the coal biz safe for the oil cos. by driving out the small guy.
As I told one Fed, before I'll mine another block of coal you'll freeze to death in the dark.
The us is out of US as far as the Feds are concerned, the idea is I'm going to make mine and devil take the hindmost.
Never did learn to quilt.
What am I missing here? The way I see it- unions have gone beyond their purpose and now they practically hold businesses hostage....
The workers are just that- they are workers..they are not stockholders- they should not be abused- but they create the very problems that force businesses to fold, leave retirees with empty promises, or move overseas....esepcailly considering all the health care wars I have heard about...
I would also like to point out that in this story- choosing to go for the buck at the plant instead of the job/career you went to college for was a choice. PERIOD. Who knows what could have happened.......besides..why is he whining about thinking htis was a solid job choice? I think 30 years is a PRETTY SOLID CHOICE!
Where am I confused?
There have been world wide, American based companies for centuries. Using the word "globalist" as a pejorative, puts you in the same category, as the crazies and yahoos who trash cities for no real reason.Unless you are really trying to emulate off her meds killer JANET FROM ANOTHER PLANET ( who, if you don't know it, is once again terrorizing many of the residents of Pine Valley !), you do need to educate yourself on this topic, more thoroughly.
Own them or are mortgaged?
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