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.

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.

for every dime we spend on a Chinese product ... it will come back as a bullet in your son's or grandson's belly in an inevitable war we will have with them.

China sells oil to the US. It get's refined and mixed into the US fuel supply. If you really believe what you said, you'd better stop buying any gasoline at all. You have no excuse for murdering your own grandson.

I think what you said is wrong and that there's nothing to worry about. I sometimes sell stocks in American companies to Chinese buyers. Every single dollar that they give me, I put in a special box to buy even more bullets to kill my customers.

< / joke >

.. missed the mexican national rebuttal. No, I was being specific and factually accurate. They were and are not as productive as My team was. It isn't arguable. We knew what their performance was on a weekly and monthly basis and heard it from the client and saw the effect of the damage being done. They were better on one stat - their ATA. And that was not of their own doing, it was forced upon them via an automated answer system. In every other area, they were detestably wanting. And they all spoke English as a second language. The biggest complaint about them was that they largely didn't care about the client. They'd bs the client just to get them off the phone. But, hey, you get what you pay for. And, what comes around goes around. Treason begets treason.

The US always used tariffs as they were designed to be used before - as a defense against subversion. Now, subversion is viewed as "just good business" by the treason lobby, and tariffs an unwanted intrusion of government.. unwanted by those who would profit by treason as it happens. Alas, government intervention must be decried as an evil if it keeps people from profiting at the expense of America. The US has not always paid this price. It used to be led by people with common sense and a love for this Country. Now it is led by people who have a love for globalism instead and couldn't care less about what it means to this country in the long run. Gotta break a few eggs, (National soverienty, civil rights, etc) to make a globalist omellette. I'm not for globalism; but, give me a spatula and I'll break it over the heads of a few globalists in the name of a Christian, Soveriegn United states. The US doesn't have to pay a price for the globalists. But, the globalists might find they'll pay a price for treason. Some of us haven't forgotten what it is or what words mean in general.

which is why I said on the margin...

Ah --we're together.

When it's business, everyone knows this and everyone deals with it-- but for me it's always amazing how many Americans I talk to aren't aware of the outstanding high level of US productivity, and how many foreigners don't want to admit to me that they know this.

"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."

"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."

Quotes from guys, lacking a college education, fortunate enough to work more than 30 years with one employer, and now they're complaining. I mean if my only skill job skill was driving a buggy in a factory, I'd be nervous too

The global market isn't a horse needing to leave or stay in the barn and has nothing to do with America. Show me where Globalism is addressed in the Constitution - it isn't. And much of what these globalist twits are doing requires them to ammend the Constitution to do. They have not attempted to do so because Americans wouldn't sit still for it. They're hoping that the long-suffering of Americans will let them get away with what they're doing before people get upset enough to do something about it. They've lost that gamble already. It doesn't seem a matter of whether they'll pay a price, it's a matter of what the price will be. People are already steamed - inexplicably so to hear the treason lobby talk. As for putting the genie back in the bottle, it isn't a genie and there isn't a bottle to worry about. This is a matter of trade policy and the Constitution. And the Government can be made to abide by the Constitution even if Globalists find it a hassle to have to do so.. So, if you'll excuse a good quote, "Who's the we, sucka." If America says, granting your metaphor for the moment, that you will put the genie back, you will put the genie back. This nation is not a bunch of sheep that will be commanded. They are the boss that tells the politicians how to manage the boss's estate. If the servant gets out of line, he may find himself jobless or worse. You might mind yourself on that matter.

.."just good business" by the treason lobby...

This is exactly what I was talking about in my post 47. We face the fact that American workers get more done than foreigners. The tin foil crowd tries to make us believe that Americans are as dumb as say, the French, and if we don't agree then we're somehow unpatriotic.

Truly astounding logic.

Not everyone could afford a college education. And that's still true today. Evidently, many think themselves better than 'buggy drivers' and snivel at the lower, unwashed among us in not too different manner than that of liberals who also think they know better than the average American. The same gallows that libs are hanging from today can always hold one more and it is no respector of party or person.

I was, in point of fact, replaced by a *cheaper*, less productive mexican national in mexico because it was *cheaper*, not because of supply and demand - not even because of the US market; but, because of US labor rates compared to foreign labor rates.

So, you were replaced because your productivity per dollar of earnings were lower than your foreign competitor. It is good that you were replaced. Jobs that are productive stay in the US, jobs that are not go to low-wage areas.

Locally, I live in Northeast Pennsylvania. A depressed area with a union mentality. While wages are low here, we do not get manufacturing jobs because of gov't laws and the union mindset. We get service jobs, especially call centers for hotels, insurance, etc. Those service jobs came out of New York City after 9-11. Those jobs were outsourced to the lowest wage, but for management purposes, kept close to the headquarters.

It seems that while dumping of product is illegal, it's fine do dump with wage rate as long as you can make a profit subverting the economy on that end of the equation.

You are intentionally skewing the definition of dumping. Dumping is when you sell products for less than their true cost. Just because someone is willing to do a job for less than what you are willing to do it for, does not constitute dumping.

Look at China, where wages are rising incredibly fast. If wages stayed low, the workers would not be able to afford products. Now China is destined to become the largest automotive market in the world. That is not because wages are $0.37 per hour. It is because wages are rising as demand increases for them.

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?

That pretty well summarizes the Bush Administration's despotic economic war against the American Middle Class.
It doesn't much matter if you are union or non-union, high or low tech, manufacturing or service. If your means of earning a living can't be outsourced offshore, Dubya will undermine your wages with imported labor, be it legal immigration or illegal. And while he's busy downsizing Middle Class America, he'll maintain the illusion of prosperity by expanding the bloated federal government with unprecedented levels of deficit spending, sacrificing our nation's future in the process.

"I am one of those who do not believe that a national debt is a national blessing, but rather a curse to a republic; inasmuch as it is calculated to raise around the administration a moneyed aristocracy dangerous to the liberties of the country."
-- President Andrew Jackson - (1824)

"Of all forms of tyranny the least attractive and the most vulgar is the tyranny of mere wealth, the tyranny of plutocracy."
~ Theodore Roosevelt

the global market horse has left the barn.

Agreed, but what seems to be missing on this thread is about how job losses are often a result of state government policies. Sure MI continues to hemorrhage jobs, (especially the cushy union ones) but so many of them are to other states rather other countries. Many businesses would rather stay with a higher educated and productive workforce here rather than going overseas if they can afford it.

MI has become much bluer in recent years as voters reward with the same incompetence that makes it a hostile place to do business - sure unions have issues that make them uncompetitive, but I'd venture to say high taxes, (small business, property, workmen's comp, etc.) are driving out the most jobs.

Others also fail to see that if some jobs don't go overseas their competition will, that is the nature of a free market. Better to gain payroll overseas than lose the company. These are the same people that bellyache (dem talking point) about 'quality' jobs not realizing that these jobs are created from free-market risk takers these days that are not likely to do so when they are taxed to death by all layers of government.

Until these punishing policies are reversed, the trends will continue.

From the New York Times on Jan. 2. 1906:
"Union officials ask government to subsidize harness and
buggy whip makers to help offset the damage done by Henry Ford and his dastardly assembly line.
Women, Minorities and Children harmed the most. sarcasm off/ What most miss is, the only thing that never changes is change itself. When I graduated from high school, the best jobs in Dayton, Ohio were at NCR or one of the GM plants. fortyleven years later, I wonder hat the best jobs in Dayton are. I know of sure it ain't at NCR.

..should have to live with American sovereignty, market rules and less profit than they could get if slavery were still in vogue.

Do "market rules" mean that a company should submit itself to countless frivolous lawsuits every time a customer is disappointed in a product?

Does it mean submitting itself to countless local, state, and federal "impact fee" laws -- thereby increasing startup and maintenance costs by hundreds of thousands if not millions of dollars?

Still, even with the extra burden to business in America, my son just got hired by a pharmecutical company (six figure salary). My best friend's son just got hired in a great job ($70,000/year)in the travel business.

A local mid-sized business near my home (which makes Christmas decorations, of all things) is booming and hiring more people.

And home repair contractors are so busy they are backed up two, three and four months in advance.

All this gripe about not being able to get a job usually comes from people who worked at one job for 20 years, and now they want to get the exact same job again.

Things change. People must change also.

In most places, $9/hr is just a survival wage. Can't afford a new car on that--unless your living at home with mommy and daddy. American cars made today are NOT junk--although quality did suffer in the 70s and 80s. All my cars are American made and I keep 'em for 8 years. I sell them not because they don't work (they do), but 'cause I want something new. I gave my sister my Olds a few years back--its still running well after 12 years.

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