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.

the Unions have forced this on themselves and us

While I'm not defending unions, the stories you see in the news seem to center on the large companies that once paid better wages and benefits and employed massive amounts of people. What doesn't make the headlines are the many, many much smaller companies that have no unions and pay far less in wages (some around minimum wage or slightly more) that also have had to close thier doors to foreign competition. One sector that has been hard hit is injection molding in plastics. Hardly known for fat wages and benefits, I used to work for a company in a related industry and the trade publications looked like an obituary evey time they published. Every publication was filled with stories of this or that company going bankrupt or closing due to foreign competition. Many paid far below $10.00 per hour with little in the way of benefits. The vast majority had no union. How did the unions bring this on those companies?

Many years ago, my father once worked for Westinghouse as a maintenance electrician. The wages were decent and the benefits were also fairly good. But no where as close to what the automakers paid. They had a mentor program and my father asked if I was interested in joining it. I was about a junior in high school. By the time I was a senior, the program no longer existed and the first round of layoffs were beginning at his facility. This was in 1973. By the mid 80's the plant that once employed about 5,000 was closed. The closing of that mentor program was the signal flare that indicated the shift taking place in our economy. At that time, the jobs were shifting to the south. Fewer unions there.

One of the affected GM plants is the Saturn plant. I believe it is losing a production line. That plant was to be the model for management/labor effeciency. Yet it has never turned a profit despite being a low cost plant. Yes there still is a union, but in terms of cost, it was to be a model for the future.

It won't be long before Honda and Toyota will also start shifting production to lower cost labor regions. They have no unions or overly generous benefits.

Tell me how, using your logic, anything you can do will affect how the chinese choose to treat their prisoners? That field of thought is too rich to cover here but it goes to show the weakness of your argument.

I fail to perceive the morality of your position. Is your argument that merely because certain people are in a position of economic and/or political weakness, that it is therefore OK to take advantage of them? Am I mistaken in the belife that the U.S. provides the world with an example, and a beacon of freedom and liberty for [legal] immigrants?

What, pray tell, is the value of *encouraging* the Red Chinese to harvest the labor (if not organs for transplant) of their political prisoners for your benefit or mine?

Try this, how can any law our country might pass long protect an inflated wage for an anachronistic job against a global market? The world has changed since there was a "big three" and your daddy drove either a Ford, Chevy or Plymouth(remember Plymouths?)and competition comes from anywhere. You can rail against it or you can compete against it but you cannot legislate it away.

This seems a blanket argument for amorality reflected in some supernational entity such as the WTO or UN.

Try this: if you and I wilfully and knowledgeably approve of and benefit from harvesting political prison or child labor, or wholesale environmental pollution, then who, if not you and I, are going to help stop it?

The world-has-changed line sounds like so much Clintonista era propaganda to me.

No, a corp[oration isn't a person, but they are owned and run by people.

Maybe not in your eyes but the law says differently:

In 1886, . . . in the case of Santa Clara County v. Southern Pacific Railroad Company, the U.S. Supreme Court decided that a private corporation is a person and entitled to the legal rights and protections the Constitutions affords to any person. Because the Constitution makes no mention of corporations, it is a fairly clear case of the Court's taking it upon itself to rewrite the Constitution.

Far more remarkable, however, is that the doctrine of corporate personhood, which subsequently became a cornerstone of corporate law, was introduced into this 1886 decision without argument. According to the official case record, Supreme Court Justice Morrison Remick Waite simply pronounced before the beginning of arguement in the case of Santa Clara County v. Southern Pacific Railroad Company that:

The court does not wish to hear argument on the question whether the provision in the Fourteenth Amendment to the Constitution, which forbids a State to deny to any person within its jurisdiction the equal protection of the laws, applies to these corporations. We are all of opinion that it does.

From here

I guess you should try reading a little more history and stop telling others they are stupid.

The great and glorious American steel industry was brought down, way back in the early '60s, by outrageous demands, a sitting president ( JFK ) who has less than no idea how to govern, let alone handle the strikes, and now, we have posters here, ranting about foreign steel.

Actually the reality is that American steel companies brought in Japanese, Swiss and German engineers to view the new steel making process called continuous casting.

The went back to their home countries and built new mills while the corporatists at U.S. Steel thought they would always reign on high in the world of steel.

They did not build new mills but thought that the existing mills would be able to keep up production.

You really only know the capitalist party line and don't look much further, do you?

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".

I'll need to disagree. Many companies are focused on long-term. An example that comes to mind - Union Pacfic (UNP). They shed their trucking business (Overnite had an IPO 2? years ago), are working to keep their locomotive fleet modernized, etc. The stock has been performing very well over the past 5-10 years...

"- I'm no Democrat!! I'm just using the terms in the same way the tax code and Social Security Administration do."

That's fair-- I call it 'passive income' when I'm talking to the revenuers too. Of course if we're using federal government definitions for these business terms then we can't say the service sector doesn't produce anything. That is if we want to be consistent --but hey, nobody else is why should we be? ;^)

Two hundred years ago, French tyrants thought that all that mattered was who had the most manpower for the army. Over time, German tyrants showed that an army backed with heavy manufacturing could beat manpower by itself. By 1945, even a huge army backed by an enormous industrial base couldn't fight a nation with plenty of scientists, instructors, and engineers. That was back when the battle was just for air supremacy. Today's warfare is for information supremacy.

RE: "I've also considered running for office."

Good luck on that!

Your response to the taunting that you received on this thread (+ the run for office idea) reminded me of when Reagan was governor.

None of the "free speech" hippies and agitators ever rattled him. On the contrary, they went even crazier with frustration.

The name-calling and personal insults intended to "refute" your positions on matters were disappointingly weak by 1960s standards -- but like the 1960s the taunters believe themselves to be superior. (Perhaps I missed their substantive arguments since I read but half the thread. I am sure they are capable of it.)

If you can take that kind of nonsense verbally as well as in print you've got one hurdle behind you.

Though I know that treason is a fact vis-a-vis military and dual use technology transfers to Red China it's a word that makes a lot of what Lenin called useful idiots recoil. IMO it's a word to be careful with in a campaign environment.

Ditto free trade IMO. Though I've read Buchanan comment favoring free trade with advanced countries (as it has always been and will always be because real free trade is good) he is denounced as a "protectionist" for opposing the Davos World.

Hope you don't mind me butting in and good luck!

I have seen many individuals work full time and attend college. Some worked two jobs to afford private school tuition, others went to community college. The lucky ones were reimbursed by their employers.

Now whether going back to school is worth it in terms of dollars or job security, that's another question. They might have been better off financially becoming an electrician apprentice, a tree trimmer, or running for office.

document the so-called dirty tricks, who did them and what named sources can prove who did them. Or did CNN not give you all those details.

Perot would have won had he not been run off by dirty tricks. He was the populist choice.. that's why he had to be destroyed. Right.. right. All pretty clear in hindsight save for those who don't want to see.

The so-called dirty trick was a picture -- real or doctored -- of Perot's daughter kissing Madonna.

A potential presidential candidate quits because he's afraid of that?? What kind of potential commander in chief is that? The current CIC puts his family at risk fighting terrorists and Perot supposedly is afraid of a doctored picture of his daughter kissing Madonna.

LOLOL!

Anyway, so I asked you how do we know that the picture came from a GOP dirty trick, to which you respond by ignoring the question and throwing out some lame insult.

I'm now going to answer the question for you since you are too stupid to know: Perot refused to divulge where that so-called compromising picture came from even though he was asked many times. So the answer to the question is that it was a unnamed sourced. Get it? Yet you believe him. As I said before you are a dupe.

BTW, if Perot was offended by the picture, then why did he wave it around at his press conference when very few had seen it up to that point?

Get it -- of course you don't.

As I said in a previous post you are a dope.

I was merely using Mrs. Adams' requests to her husband, for IMPORT GOODS, to prove that Americans have ALWAYS bought things not made here. Gee, even when more things were manufactured here, many people still bought foreign goods instead.

And that particular point is almost completely irrelevant because no protectionist is saying no imports. Where is our oil and other mineral commodities going to come from? A 25% revenue tariff, returning us historically back to what works, is not, and wasn't then, an insuperable barrier.

The Masons were NOT a trade union, in the 18th century; pet. If you're going to attempt to "teach" someone a lesson...don't do so, when you, yourself, know less than nothing at all about the topic.

Well, pet, I guess I have to teach you something, because apparently you need to learn to read. LOL!

I never said that they were a "trade" union. To be exact, quoting myself: "And btw, there weren't any egregious U.S. unions for you to genuflect against, unless you count the FreeMasons. And most of the Founders were such..."

Nowhere did I say trade, or craft, or any such thing. Nor inferring such. I was drawing a larger condemnation of your ill-founded, and lame philosophy...and how you squarely run athwart the principles of the Founders...who virtually all agreed with 'protectionist' trade policies...which were in fact freedom to them. I implied that you are diammetrically opposed to those Founders. And it went right over your head.

They say that those who can't, teach. Sigh. Apparently the nostrum applies to you....

Cry Havoc, and let slip loose the dogs of outsourcing.

I do agree with you to a point. I don't think its a good idea to send our industry hand over foot to other countries. Its bad policy and its bad economics. On the other hand, the people quoted in the article speak of economies from 20 and 30 years ago. In my opinion, especially those in the state of Michigan, the state and namely Detriot has done a piss poor job of transitioning in the last 3 decades - both unions and management.

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