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Ford to start hiring at reduced wage

  • ZWICK 4 PREZ
    http://online.wsj.com/article/SB10001424052748704762904575025420550494324.html
    By MATTHEW DOLAN
    Ford Motor Co. will announce Tuesday it is adding a second shift at its Chicago assembly plant, creating 1,200 jobs and enabling the company for the first time to hire some new union workers at significantly reduced wages.

    The contracts that Ford, General Motors Co. and Chrysler Group LLC signed in 2007 allow the auto makers to fill jobs vacated by older workers who leave or retire with new hires earning a little more than $14 an hour on averageā€”about half what current workers received when they started. Newer workers also get reduced benefits.

    The new "second tier" wage was a big concession for the United Auto Workers union, whose workers have enjoyed some of the highest manufacturing wages in the world. It agreed to accept reduced pay for newly hired workers in an effort to help make the Detroit Three more competitive with foreign car makers that use nonunion labor in their U.S. plants.

    GM and Chrysler hired some workers at the reduced wage but laid off all or most of them when the companies slashed jobs as the recession and downturn in auto sales deepened. Ford never hired lower-wage union workers.

    But with sales now showing signs of recovery, both the Big Three and foreign car makers are increasing production and adding factory jobs.

    Hiring a second shift of workers at Ford's Chicago plant should trigger the hiring of entry-level workers, said Jim Tetreault, Ford's vice president for North America manufacturing, though he declined to estimate how many.

    Sean McAlinden, chief economist at the Center for Automotive Research in Ann Arbor, Mich., said he suspects Ford will be able to hire a few hundred workers at the lower wage, and possibly as many as 600. Even a few hundred would improve the economics of the Chicago plant. Besides the lower wage, new workers also get 401(k) accounts for retirement instead of pension plans that Ford is obligated to pay out for years.

    It will still probably take years for Ford and the other Detroit auto makers to bring their total labor costs down to the level of their foreign competitors, Mr. McAlinden said. Even with recent concessions, an hour of union labor costs GM about $59, including wages and the cost of all benefits, he estimated.

    The gap can be closed only if GM does "mass hiring of entry-level workers," Mr. McAlinden said, adding he doesn't expect that to happen until at least after 2015 based on U.S. production estimates through then.

    At Ford, the contract with the UAW limits the number of lower-wage workers to 20% of the company's total work force. Ford also must see how many current but laid-off workers will apply for jobs in Chicago. About 1,000 who will be idled at Ford's Louisville, Ky., plant and 600 others who were idled but remain on the payroll will be first in line for the Chicago jobs.

    It is unlikely all of the Chicago jobs will be filled by those workers because some will opt not to move. The Louisville plant also is supposed to reopen next year and will recall many workers.

    "There will be new people hired at Ford," said Bob King, the UAW's vice president in charge of relations with the car maker. Mr. King is the union leadership's nominee to succeed UAW President Ron Gettelfinger.

    GM has no plans to hire workers at the lower-tier wages this year, said spokeswoman Sherrie Childers Arb. The company still has about 6,500 laid-off workers who have the right to take jobs at existing wages as they open up, she said.

    GM expects the number of its workers on indefinite layoff to fall when the auto maker adds a third shift at its Lansing Delta Township plan in Michigan and Fort Wayne factory in Indiana, she added.

    Chrysler has "several hundred" laid-off workers who have the right to jobs, according to a person familiar with the matter.

    Ford's Chicago plant builds two large sedans, the Ford Taurus and Lincoln MKS. The second shift will be added to produce a redesigned Ford Explorer sport-utility vehicle later this year.

    Ford plans to spend $400 million to ready the Chicago plant for SUVs. Ford now builds the Explorer in Louisville but that factory will be converted to small-car production next year.

    Write to Matthew Dolan at [email protected]
    About 30,000 a year starting out with no education or skill. Seems more than fair to me.
  • tsst_fballfan
    Best thing they could have done was get rid of the union!
  • LJ
    ZWICK 4 PREZ wrote: http://online.wsj.com/article/SB10001424052748704762904575025420550494324.html


    About 30,000 a year starting out with no education or skill. Seems more than fair to me.
    Me, you, and everyone else in this country knows that there will be 10,000 people applying for these jobs and basically bustin down the doors to get one.

    $30k starting out is quite amazing. A lot of college grads can't even get that.
  • ytownfootball
    LJ wrote:
    ZWICK 4 PREZ wrote: http://online.wsj.com/article/SB10001424052748704762904575025420550494324.html


    About 30,000 a year starting out with no education or skill. Seems more than fair to me.
    Me, you, and everyone else in this country knows that there will be 10,000 people applying for these jobs and basically bustin down the doors to get one.

    $30k starting out is quite amazing. A lot of college grads can't even get that.
    I bet the majority hired will have a degree.
  • jmog
    I would say that is a fair wage for a factory worker.

    Compared to the $30+/hr that most manufacturing jobs for the Big Three were paying for years, this will make Ford even more competitive.

    Let's not forget that most of these workers will make well over $30k once OT is figured in.
  • LJ
    ytownfootball wrote:
    LJ wrote:
    ZWICK 4 PREZ wrote: http://online.wsj.com/article/SB10001424052748704762904575025420550494324.html


    About 30,000 a year starting out with no education or skill. Seems more than fair to me.
    Me, you, and everyone else in this country knows that there will be 10,000 people applying for these jobs and basically bustin down the doors to get one.

    $30k starting out is quite amazing. A lot of college grads can't even get that.
    I bet the majority hired will have a degree.
    Majority hired? Eh maybe, but the majority who apply definitely will.
  • ytownfootball
    The assertion that floor workers are unskilled and uneducated in the US is bogus.
  • LJ
    ytownfootball wrote: The assertion that floor workers are unskilled and uneducated in the US is bogus.
    Unskilled? Definitely not
    I don't consider a HS Diploma uneducated.
  • Bigdogg
    Those of you who despise unions would be wise to go back and read history before unions existed.
  • ytownfootball
    There are a lot of floor rats that have college education and diplomas in their drawers at home.

    Balleee dat
  • LJ
    ytownfootball wrote: There are a lot of floor rats that have college education and diplomas in their drawers at home.

    Balleee dat
    ok? So?

    Are you saying there aren't a lot that don't have high school educations only?
  • ZWICK 4 PREZ
    ytownfootball wrote: The assertion that floor workers are unskilled and uneducated in the US is bogus.
    There's not too many entry level factory jobs that require a degree and trade experience. I can't even think of one to be honest. Thus, pointing out that making 30k a year for no education or experience would be justified.
  • ytownfootball
    No, there are to be sure but the gap today is far from what it was 40 years ago. Yet the perception remains that...
    About 30,000 a year starting out with no education or skill. Seems more than fair to me.
    It's not nearly as true as it once was.
  • LJ
    ytownfootball wrote: No, there are to be sure but the gap today is far from what it was 40 years ago. Yet the perception remains that...
    About 30,000 a year starting out with no education or skill. Seems more than fair to me.
    It's not nearly as true as it once was.
    If the requirements were a piss test, HS Diploma and getting hired through an interview 40 years ago, I am pretty sure it's still the same?

    You are arguing something no one ever said.
  • ytownfootball
    ZWICK 4 PREZ wrote:
    ytownfootball wrote: The assertion that floor workers are unskilled and uneducated in the US is bogus.
    There's not too many entry level factory jobs that require a degree and trade experience. I can't even think of one to be honest. Thus, pointing out that making 30k a year for no education or experience would be justified.
    Though not required, the application pool will consist of waaayyyy more educated (college) individuals than it would have even 20 years ago....bank it.
  • LJ
    ytownfootball wrote:
    ZWICK 4 PREZ wrote:
    ytownfootball wrote: The assertion that floor workers are unskilled and uneducated in the US is bogus.
    There's not too many entry level factory jobs that require a degree and trade experience. I can't even think of one to be honest. Thus, pointing out that making 30k a year for no education or experience would be justified.
    Though not required, the application pool will consist of waaayyyy more educated (college) individuals than it would have even 20 years ago....bank it.
    So? Why are you arguing with yourself?
  • ZWICK 4 PREZ
    ytownfootball wrote: No, there are to be sure but the gap today is far from what it was 40 years ago. Yet the perception remains that...
    About 30,000 a year starting out with no education or skill. Seems more than fair to me.
    It's not nearly as true as it once was.
    Lets figure it this way.. I started out in the 50's with a BSEE. I have a good friend who started out at 35k with a AASEET. 30k for no degree at all seems more than in line.
  • ytownfootball
    Not arguing the pay rate, saying the education level is higher than what you say it is.

    prolly the skill level too.
  • ts1227
    You're not defining "unskilled" properly.

    When they say "unskilled" labor, its not saying that the person isn't doing anything worthwhile... it's the idea that the learning curve is small enough that a large amount of people at different education levels (specifically lower ones) can go in and acquire the said skill rather quickly, and that commands less in wages. If people find that insulting, I don't know what to tell them.

    And in this economy, sure there will be more educated people in the pool than usual. It has nothing to do with the job description, it has to do with being an available job with that starting salary. Some people screwed up and got degrees in fields with no jobs and will take anything right now.
  • Con_Alma
    ytownfootball wrote: Not arguing the pay rate, saying the education level is higher than what you say it is.

    What's the education requirement?
  • trackandccrunner
    Too bad this is in Chicago or I'd apply lol.
  • ernest_t_bass
    Doesn't seem fair to me. My wife has education, and she is working in a business office, making MUCH less than that. I honestly don't understand how an assembly line worker can get paid more than someone with a degree. We could possibly see cheaper cars if they got paid as much (or as little) as others. Supply and demand, I guess.
  • LJ
    ytownfootball wrote: Not arguing the pay rate, saying the education level is higher than what you say it is.

    prolly the skill level too.
    No you aren't

    You are arguing against a statement that was never amde
  • ZWICK 4 PREZ
    ytownfootball wrote: Not arguing the pay rate, saying the education level is higher than what you say it is.
    It is in some cases. That can be said at any level in any industry. But that fact that you're still getting paid 30k for a job that requires no education or experience remains the same.
  • ytownfootball
    About 30,000 a year starting out with no education or skill. Seems more than fair to me.
    I don't disagree with this statement other than the fact that those hired will in all likelyhood have a higher education than high school and a skill set that exceeds the minimum required. The job market dictates it.

    If what I say is true, then for some in that pool, 30K is a slap in the face, and not a candidate for a look down your nose. That's all I'm saying. Were the job market better, they would be starting out higher paid and likely in a white collar position.