Lower wages are new reality as Detroit Three add workers

[ChromeFoundry]

Source: AP

Article published June 20, 2010

DETROIT - Every day at a General Motors Co. plant near Lansing, employees drive hundreds of Buick Enclaves - many with leather seats for seven and on-board video systems - off the assembly line.

But driving one home would be tough for the plant's newest employees, whose annual pay is less than the $35,000 that even the cheapest Enclave costs. Newly hired members of the United Auto Workers at GM, Ford Motor Co., and Chrysler LLC are paid about $14 an hour, half the rate for veterans under their current contract.

It's a far cry from the days when the union autoworker had one of the sweetest deals in American labor. And within the Enclave plant near Lansing, the disparity creates mixed emotions, including some resentment, among the 130 recent hires.

"It's difficult to look across the line at someone getting paid more for doing the same job you're doing," said Steve Barnas, the plant's union bargaining chairman.

For decades, the UAW tugged wages upward. In 1960, a UAW member made 16 percent more than the average American manufacturing worker. By 2006, the figure was 74 percent. Today, new hires in the UAW make about 20 percent less than the average.

Read more: http://www.toledoblade.com/apps/pbcs.dll/article?AID=/20100620/BUSINESS02/6190395

[awoke_in_2003]

1. pathetic...

these people work hard, and you can guarantee the CEO and other chief officers haven't had their wages reduced.

[cstanleytech]

8. Compared to some though they are doing ok.

My brother for example would love to get that kind of money as he works in the grocery industry and doesnt even come close to clearing that and hes an assistant produce manager for nearly 14 years with the same company.
As for the whole CEO pay issue, theres not much offhand I think the government can do that wouldnt get tossed off as unconstitutional if they tried, the real ones who have the responsibility for that are the stock holders, they are the ones who need to fix the disparity.

[awoke_in_2003]

32. true...

but this will only cause a ripple effect downward for everyone.

[madrchsod]

2. even the asshole ford figured he`d have to pay his workers...

enough money to afford the cars they built...

[sandnsea]

3. So now auto workers make 20% less

Where were these articles a year ago. All we heard then was that union workers were making $75 an hour.

[OnlinePoker]

23. New hires make 20% less.

I can't see in the article if that $14 starting wage goes up at any point to eventually match the veteran worker salary or not. Does anybody know?

[sandnsea]

31. And where were these articles last year

During the auto industry bail-out. They never reported anything about any union worker making less than average workers.

[LiberalFighter]

35. They will never go up to match previous wages under current contract.

[starroute]

30. Workers were never taking home anything like that

The $75 an hour figure included the employer's share of social security, unemployment, workers compensation payments -- which are pretty high for assembly line work -- health care, pensions, and everything else they could possibly justify throwing in.

Within certain contexts, it makes sense for a business to figure the total costs of adding an additional worker. But the way it was played in the media, it came across as though auto workers were taking home $150,000 a year, which was not even close to the truth.

[entanglement]

4. The modern UAW is a huge part of the problem. It has acted as treacherously as corporate management

It has betrayed strike after strike, suppressed workers, negotiated double-deals behind their backs and generally acted more like co-managers than a union. UAW bosses' sordid behavior in negotiating LOWER wages and worse conditions for new hires can never be forgotten.

The truth of the matter is that the UAW stopped representing workers a long time ago. It is a business, concerned only with swelling its coffers and ensuring its crooked bureaucracy a cushy life.

[OHdem10]

5. Or did they realize Globalization has created a crisis and you cannot

get blood out of a turnip.

Living Standards in the US and EU are being lowered so there
is not such a wide discrepancy between First and Third World
Countries. Peoples in lower wage countries cannot afford
the products made in U.S. We get flooded with less expensive
products but cannot sell so many of ours.

The bottom line is the Trade Policies and Practices got screwed
up and we are in a crisis. This is why we are having so many
jobless recoveries.

Tonight I noticed people can buy a Kia and their monthly payment
is 159 dollars monthly.

[JDPriestly]

12. OHdem10 -- You are absolutely right.

As long as we let cheap imports into the country without taxing them to pay for Social Security, highways, etc., then most of us will become poorer and poorer.

[Sherman A1]

17. Agreed

I believe that you hit the nail on the head! I hope that the auto industry, the workers and the unions recover, but it will take time to do so. This situation did not happen over a short time frame and Yes, I am sure that the unions made some mistakes along the way, but it is their job to get the most for their workers, it is managements job to run the companies and produce product that are relevant to the times. It was not the Unions that designed the cars, it was not the Unions that did the marketing, it was not the Unions who made bad business decisions for the companies. It was management. So we should not blame the workers or their representatives for trying to make their lives as good as possible.

[pipoman]

29. UAW supported NAFTA and GATT

IIRC

[LiberalFighter]

37. No it didn't. Locals got the word from Intnl to phone Congress to vote against it.

[LiberalFighter]

36. You know nothing about the UAW or unions.

Swelling its coffers? Hah!! If they were swelling their coffers they wouldn't be combining regions and reducing staff and combining duties for officers and staff members.

As for representing the workers that is the responsibility of the locals utilizing the resources of the region and international.

[OhioChick]

6. Reminds me of....

When Whirlpool moved their factory (fairly recently) to Mexico and someone pointed out that the wages offered couldn't even buy a refrigerator, etc.

Utterly pathetic.

[DCBob]

7. Mostly the result of globalization... we are in a wage correction phase now in most job sectors..

Generally speaking Americans have been overpaid for decades compared to the rest of the planet. Mostly due to economic bubbles that were not real.

[AdHocSolver]

10. Globalization is a corporate buzzword on a level with Santa Claus and the Tooth Fairy.

Americans have NOT been overpaid for decades, because the pay rate in the U.S. needs only be compared to the cost of living in the U.S., not the pay rate or cost of living in other countries.

The economic bubbles were caused by the Federal Reserve's manipulation of the money supply and the Ponzi schemes run by Wall Street and the banks. The "bubbles" were very real and had nothing to do with wages.

[DCBob]

16. Corporate buzzword???

Well respected economists and social scientists have been using the term for decades. You need to read more..

Try this one..

http://www.thomaslfriedman.com/bookshelf/the-world-is-flat

BTW, the "bubbles" most definitely affected jobs and wages.

[pattmarty]

20. Jesusfuckingchrist, you "use" Friedman for an example? You do................

.........know he IS NOT an economist? He's a very wealthy ne'er do well that has made a name for himself with his stupid "world is flat" bullshit.

[DCBob]

24. Excellent book.. I would suggest reading it..

BTW, not all intelligent thoughts on the economy come from "economists".

[pattmarty]

33. I watch C span, LINK and FSTV among others and when I see........

.........somebody talking about certain subjects and may have a book out, I will sometimes check out the book from the library or even purchase it. I have seen Friedman on numerous shows and for the most part he likes to hear himself speak and I've never been impressed with him. He loves globalization, I get it.

[JDPriestly]

14. Boy have you drunk the koolaid, DCBob.

What can we expect from somebody who lives in DC.

[DCBob]

15. I dont think so...

cant stand the stuff.

[LanternWaste]

26. Or world wide workers have been underpaid...

Or world wide workers have been underpaid...

(Six of one half a dozen of the other. I guess it depends on which one better validates our own personal notions...)

[DCBob]

27. No doubt many are terribly underpaid but correcting that problem is another issue..

with no solution in sight.

[LanternWaste]

38. As is the problem of underpaid American workers...

"...with no solution in sight."

As is the problem of underpaid American workers...

[AdHocSolver]

9. So long as corporations can import goods more cheaply than they can make them here...

...the standard of living for most Americans is going to continue to decline.

The unions had leverage with the corporations when most goods sold in the U.S. were made in the U.S. The unions could shut down the production line at one company, and that company would lose business -- and profit -- to another manufacturer. There was economic pressure for the company being struck to negotiate a settlement with the union.

Nowadays, it is easy for any company to find a foreign manufacturer to supply their products so the pressure is on the workers to cave in to the company to keep their jobs.

So long as corporate cartel agreements such as NAFTA, the WTO, the World Bank, the IMF, and their ilk are running the U.S. economy, the jobs and the standard of living in the U.S. will continue to decline.

The only solution is to replace the corporate cartel agreements with import quotas and tariffs to level the playing field for the American worker, and provide those companies who want to produce goods in the U.S. using American workers a level playing field so that they can manufacture goods in the U.S. profitably.

The first event that has to occur is to convince a large segment of the buying public to "buy American", and if they can't find what they want that is made in the U.S., then tell retailers they will not buy foreign-made goods, and stop providing profit to companies that sell mostly imports.

Americans are really incompetent consumers. They spend good money on cheaply made, over-priced, shoddy goods that are unrepairable and break down quickly, or like imported food, toys, and drywall, contain toxic ingredients, and wonder why all the jobs are being offshored. Well, duh! You eagerly buy all this stuff providing corporations with huge profits, and wonder why the economy is in a ditch.

The phrases "free trade" and "global economy", among others, are not economic terms, but corporate buzz words to confuse people about the way this country is being royally screwed.

Another fantasy that people have to get over is that having more workers join unions is going to make a difference in the race to the bottom. As long as profits can be maximized by offshoring jobs, the leverage belongs to the corporations and the race to the bottom will continue.

[JDPriestly]

13. You are so right.

I am no longer much of a consumer. We just don't have the money to consume anything much. We are retired.

[pattmarty]

21. Very well put, informed treatise against the "world is flat" argument.

The "old" tariff system is the only way for countries to protect themselves against these "free movement" corporations. So called free trade will turn the USA into Mexico, Haiti or name any shitty third world country. It's pretty obvious we have started the decline already over the past 30 yrs and now it's in overdrive.

[OhioChick]

34. Well said. n/t

[JDPriestly]

11. Divide and conquer. The final blow to unions.

[Hubert Flottz]

18. The "New World Order" at work...

Bust the unions and bring America's standard of living down to third world level.

[xchrom]

19. a small slice of what's happening to America as a whole.

how far we have fallen.

[KurtNYC]

22. At first glance I thought it said "Detroit adds three workers"

[NikRik]

25. The low end workers getting the shaft !

I remember when 10 dollars an hour was,nt so bad in the seventies. Now in 2010 its what many companies are paying their emplyees and I do not even consider it a living wage. To top it off they are hiring more part time so they do not have to supply health care, vacation pay and sick pay. Most of the employees at the place Iam speaking of are from other countries however in the US leagally. The owner a miser who lives like a homeless person makes over 1/2 a million a year plus a percentge of the yearly profit ,which Iam sure he quickly hides away. He perfers the non US emplyees ,they are just happy to have a job and will work for ten $ an hour for the rest of their lives ! Its really sad what our country has come to greed and the me mentality rule the day ! The odd thing is the CEO was a sixties hippie who is now a republician ?

[pipoman]

28. Just like our Mexican brothers

can't afford the cars they are building for the big 3...buy American! Who cares where they are actually built or how much the employees are earning, at least the profits are coming to America...:sarcasm: