State of the Auto Industry

Tirjasdyn · Jan 12, 2009

I know this is a hot button topic...but statements like this piss me off:

Frank Warren, 49, who works at a GM transmission plant, said the autoworkers have given up enough. "We've given up positions that it's taken 30 years to get," he said. "We've got workers coming into our doors now making $14 an hour without health care. Can you support your family on $14 an hour and pay a mortgage? I don't think so."

Oh frelling boohoo. Actually the answer is YES YOU CAN. I've done for the last 8 years, except for a brief 6 months where I made $17 an hour at my day job and brought home LESS money because of the shiny new tax bracket I was in.

I make $14 an hour, support my family, and pay all my bills and a mortgage. I don't have health insurance and I have hefty medical bills to pay. I could make more on my freelancing...but there never seems enough of those jobs around for me to pay my bills.

There's no bail out for me.

for the rest of the article:

http://www.npr.org/templates/story/story.php?storyId=99235435

Don't worry it's text not sound clip.

Plot Device · Jan 12, 2009

I think your point is valid. However, I also think that the particular section of this country where their industry is located can have an impact on the overall cost of living.

The auto workers live in a region (Detroit and there abouts) where public transportation has been deliberately decimated. They are living in needlessly car-reliant communities, and so a huge precentage of them are all saddled with being two-car families who must commute obscene distances to work.

I'm not saying nobody else in this great car-worshiping nation is likewise trapped living in automobile-reliant hell. I'm simply saying that the ability to

a) eliminate at least one entire car from a 2-car family
b) commute only a few miles to work instead of 40 or more

can make a huge difference in the family budget as well as in the number of hours in the day avialable to do the kinds of things that can help save even more money (such as home cooking, walking to school and to the local store, etc) as well as promote greater personal health in the family.

That said, the auro industry itself is the villain who eroded public transit. I say make those bastards re-tool their factories to produce seriously high-quality trains and trolleys. And then force them to get the hell out of the way of all efforts to restore the thousands of miles of train and trolley tracks in this nation that they are directly/indirectly responsible (some cases they are removed by only two or three degrees of responsibility) for having ripped out over the course of 70 years.

And no frigging buses either--the buses don't count, only the trains and the trolleys.

Tirjasdyn · Jan 12, 2009

Plot Device said:
The auto workers live in a region (Detroit and there abouts) where public transportation has been deliberately decimated. They are living in needlessly car-reliant communities, and so a huge precentage of them are all saddled with being two-car families who must commute obscene distances to work.

Actually I live in a car reliant community. A monthly pass for the bus costs more than fuel for my care EVEN when gas was 3.95 a gallon. It's also a three hour trip by bus. By car it's 30 minutes to an hour depending on traffic.

I'm not saying nobody else in this great car-worshiping nation is likewise trapped living in automobile-reliant hell. I'm simply saying that the ability to

a) eliminate at least one entire car from a 2-car family
b) commute only a few miles to work instead of 40 or more

can make a huge difference in the family budget as well as in the number of hours in the day avialable to do the kinds of things that can help save even more money (such as home cooking, walking to school and to the local store, etc) as well as promote greater personal health in the family.

Yes it can....however this lifestyle can be maintained on 14$ an hour. I've done it and have done and continue to do so.

MissKris · Jan 12, 2009

You know, I think the unions did (and even in some cases, do) have their place in the market, but $14/hour for a job that is basically unskilled (and, yes, entry-level auto-industry jobs are unskilled) is more than most get. $14/hour? Try a real minimum wage on for size. Quit whining. Either take the $14/hour or be prepared to have NO job.

I did a quick check on real estate prices in Detroit and, from Trulia.com, came up with $78,000 as an average price. So, an average home in an average area costs under $600 a month (with a 5% down payment, 6% interest + estimated taxes and insurance).

600 BUCKS?!?!?!?!? That's easily within the 30% of salary recommendation for buying a home. Quit fricken' whining!

In Seattle I couldn't find a home lot (no house, just land) for that price. And no, salaries aren't that much higher here; there are loads of folks making less than that. Heck, teachers, who are actually trained for something/have a college education, start out at only a couple grand a year higher than that entry-level, unskilled auto worker.

The auto industry is dead and the more the unions whine about it, the more they'll see their jobs shipped overseas.

BTW, here is a video (sorry) about Ford's Brazil plant. It's awesome and could really save Detriot, but UAW isn't going to let it happen. Shame.

http://http://www.ritholtz.com/blog/2008/11/fords-most-advanced-assembly-plant-operates-in-rural-brazil/

Bubastes · Jan 12, 2009

MissKris said:
I did a quick check on real estate prices in Detroit and, from Trulia.com, came up with $78,000 as an average price. So, an average home in an average area costs under $600 a month (with a 5% down payment, 6% interest + estimated taxes and insurance).

600 BUCKS?!?!?!?!? That's easily within the 30% of salary recommendation for buying a home. Quit fricken' whining!

That's IN Detroit, aka Beirut. Most people live and work in the suburbs, where the housing prices are higher. Detroit itself is not a place where most people want to live.

alleycat · Jan 12, 2009

Is GM really hiring workers for $14? Assuming they're actually hiring these days.

I don't know what the average wage rate is at GM's older plants (I would guess much more than $14); I know that workers at Saturn make more than $14 an hour.

Magdalen · Jan 12, 2009

Yes it can....however this lifestyle can be maintained on 14$ an hour. I've done it and have done and continue to do so.

I find this hard to believe. To what type of "lifestyle" do you refer? What do you guys eat and how many people are you supporting on $14 an hour? Do you get overtime?

600 BUCKS?!?!?!?!? That's easily within the 30% of salary recommendation for buying a home. Quit fricken' whining!

You wouldn't want to live in that neighborhood, unless you own a gun.

I lived in Downtown Detroit for 10 years, we moved when we started a family.

The actual salary of autoworkers with 10+yrs seniority is something like $28 PH, but then there are a lot of benefits that are attached so I think the figure that was being tossed around was $58 in total wages and compensation. And then there's the shitload of retiree pensions and healthcare costs.

http://www.autonews.com/article/20090112/ANA02/901120225/1176

But let me be clear: I think they were getting a helluva good deal and were overpaid, to boot.

This is such a complex issue that I don't think I can do it justice in post-comments, and I certainly am not looking for a fight or argument.

Dommo · Jan 12, 2009

Any job which has a low barrier of entry is by its nature going to be a low paid job. The autoworker jobs require for the most part(aside from the skilled laborers, like welders, etc.) no formal education. Anyone who's literate and has gone through high school can do them. This is the problem.

When you've got millions who can easily do your job, then the value of your labor drops. That's why guilds formed up back in the old days, was so that trades could maintain quality AND keep the value of their labor high.

Autoworkers are gimped in multiple ways pay wise.

1. HUGE number of available workers that can do the job, and are willing to do it for 14 bucks an hour.
2. Automation that's getting better with every year.
3. An economy that is now faced with global competition.

Tirjasdyn · Jan 13, 2009

Magdalen said:
I find this hard to believe. To what type of "lifestyle" do you refer? What do you guys eat and how many people are you supporting on $14 an hour? Do you get overtime?

I support myself, my daughter, 2 cats and 2 dogs. In the past I've supported my ex-husbands. We eat fresh food, mostly protein and salad veggies ( I have to for my health). We live in a three bedroom house with a fully finished basement. I buy all the food for 3 people at the tune of 300$ a month.(includes my boyfriend.) I pay a first and second mortagage on a three bedroom house I've been trying to sell for nearly two years, and utilities on said house. I have a credit card balance, school loans, heafty medical bills for kidney stone operation I had to have this summer. I drive a two year old saturn and I pay the loan on that. I pay daycare, school costs and I live in a suburb of Denver.

I still manage to buy Christmas presents, give my daughter a modest allowance, maintain my car, and my residance and the stupid house that won't sell. I have a monthly book allowance, and I get Starbucks during the week. I send the daughter to day camp in the summer. And we take vacations. It's called saving, bargan hunting, and making sure my warrenties are caught up. It's called a budget. Do I worry a lot. Yep.

It's also called having both partners work. But then I used to have a deadbeat husband who never worked and when he did he spent his paycheck before it came home (if ever). I managed to support him as well, till I kicked his ass to the curb.

You wouldn't want to live in that neighborhood, unless you own a gun.

Did I mention I own guns

I lived in Downtown Detroit for 10 years, we moved when we started a family.

My father's side of the family is from Detroit, I spent summers there as a kid. My mother's side is from Windsor and Detroit. My great-uncle worked for GM for 40 years. He now lives off his pension in Florida as an illegal alien(he's Canadian), he gets deported every couple years. He managed to save and invest his pension so when it disappeared suddenly he still lives very very well.

I used to work the nightshift for emergency car help for various insurance companies. When Clients with a broken down car called we were always forced to tell them to lock their doors and get under their seat, because the tow trucks wouldn't come and the cops won't come till daylight.

Clair Dickson · Jan 13, 2009

Industry has always provided the back bone of our society-- providing jobs you could live on and support a family. NOTE: I think the wages have gotten to the obscene point.

My husband and I used to make about $14/hr combined. ($7 each). We worked 40 hour weeks and just barely qualified for a one bedroom apartment next to the railraod tracks. We lived frugally and owned our cars. We could probably have gotten a two bedroom apartment if we weren't paying our way through college. It was tight existence, and we couldn't save any money (you know, for a house.) I wouldn't recommend that lifestyle.

The only plus side to everyone making minimum wage, or even double it, is that the cost of things will have to go down. You can't afford much on a low wage-- so less consumer goods, less business at the local retailer (who cuts staff) less people buying new cars... But at least I'll be able to afford things finally. Like the housing market-- I actually got to buy a house with space for my eventual family.

And the funny thing is, once you get out of Detroit (and the immediate suburbs) the prices are insane and commute torturous. It's a long, long way until things are 'affordable' again. Oh, let's not forget the joke of a bus line Detroit... good luck getting a ride. If you manage to move into a safter neighbor hood, there is pretty much no bus service.

Tirjasdyn · Jan 13, 2009

Clair Dickson said:
Industry has always provided the back bone of our society-- providing jobs you could live on and support a family.

It has, but that backbone has suffered from osteoporosis for a very long time. Industry as in manufacturing is very small to what it was even 30 years ago.

And dammit they've coasted. I've been outsourced out of two industries. I could have gone into meat packing at 18$ an hour in college, but realized that then I would be stuck there. When I went through my first divorce I had to make some hard choices and was forced to abandon a career path in order to pay the bills and care for my daughter. But I did it. I work in the non-profit sector now because it's my choice and it's been worth it but that worth brought my pay down dramatically. I make it work.

So when these folks cry that they aren't getting paid for closures, pensions, and new hires are making $14 an hour, then they cry they need a bailout.

I find it extremely hard to sympathize.

Why isn't the spouse working (they are claiming they are supporting families)?

astonwest · Jan 13, 2009

Not excusing their greed (especially with my personal opinions on labor unions), but realize that when people make more money than they need, they tend to spend it, pumping it into the economy...

Tirjasdyn · Jan 14, 2009

astonwest said:
Not excusing their greed (especially with my personal opinions on labor unions), but realize that when people make more money than they need, they tend to spend it, pumping it into the economy...

I can agree with that.

Clair Dickson · Jan 14, 2009

Sometimes a working spouse may not be worth the daycare money. If Hubby and I had kids and had to put them in daycare, we'd nearly negate his entire paycheck-- just with one kid. (Going off the figures my SIL just researched for her new offspring.)

I think we're in for serious trouble as industry drops to the level of retail wages. (My Hubby makes $12/hr in retail, peon level.) We'll lose a huge, huge amount of buying power, which will translate into less sales.

What jobs will replace it? I don't know of too many semi-skilled jobs (I'm thinking that semi-skilled would be where we'd see the $20/hr wages.) Colleges are raising their prices and the people who can't go to college are going to have a really hard time supporting their families. We don't have much in the way of voc.ed to teach people skills that get them out of the Wal-Marts and into a job that they can support a family on (either with one or two parents.)

I don't like the obscene level that auto company jobs have risen to, but I don't like that there are few jobs that pay worth a hoot without requiring post-secondary education. I work with a lot of kids who will never be college material. They don't have skills and know/believe that with auto (and other) industry jobs gone, they will be stuck working at Wal-Mart or McDonald's for peanuts.

Tirjasdyn · Jan 14, 2009

Clair Dickson said:
Sometimes a working spouse may not be worth the daycare money. If Hubby and I had kids and had to put them in daycare, we'd nearly negate his entire paycheck-- just with one kid. (Going off the figures my SIL just researched for her new offspring.)

That's entirely true.

I think we're in for serious trouble as industry drops to the level of retail wages. (My Hubby makes $12/hr in retail, peon level.) We'll lose a huge, huge amount of buying power, which will translate into less sales.

12 in retail!!! That's a lot...really it is.

I don't like the obscene level that auto company jobs have risen to, but I don't like that there are few jobs that pay worth a hoot without requiring post-secondary education. I work with a lot of kids who will never be college material. They don't have skills and know/believe that with auto (and other) industry jobs gone, they will be stuck working at Wal-Mart or McDonald's for peanuts.

I don't know. Unskilled labor is really disappearing in this country unless they work at the farm level or start their own business....we're reaching ground zero here. There is always secretary work...but even that has morphed in to a crazed computer support job on the cheap.

Clair Dickson · Jan 14, 2009

I know $12 in retail is on the high end for peon work. We both worked in retail for a long, long time. Since retail rarely pays a living wage, how do people support themselves or their families? We're not giving them those tools in high school, but college is unattainable by price or ability for many.

There are few unskilled and few semi-skilled jobs. Our high schools do nothing to prepare kids for the semi-skilled trades-- nothing to get them into places like auto shops where they can learn skills and made a living wage.

The only plus is that computers are becoming so prevalent in schools, that kids aren't going into jobs without some knowledge. (First learning curve: myspace doesn't translate to MSOffice skills. ;-)

I've seen what lack of an industrial base does. Michigan is failing as a state right now as all the auto jobs bail. (I think it was damned stupid for the state to cater *only* to the auto companies for fifty years, but the eggs have broken out of that lone basket.)

If there are execs making several billion a year (and holding several such positions-- how are they *really* running a multiple companies at the same time??), then I'm not going to cry about Joe Six-pack making $14/hr for much more difficult work. But that's just me and I admit my bias is towards the guy on the bottom. Of course, I'm always on the bottom...

State of the Auto Industry

Tirjasdyn

Outline Maven

Plot Device

A woman said to write like a man.

Tirjasdyn

Outline Maven

MissKris

Is the random.

Bubastes

bananaed

alleycat

Still around

Magdalen

Petulantly Penitent

Dommo

On Mac's double secret probation.

Tirjasdyn

Outline Maven

Clair Dickson

A dark core to every cloud

Tirjasdyn

Outline Maven

astonwest

2 WIP? A glutton for punishment

Tirjasdyn

Outline Maven

Clair Dickson

A dark core to every cloud

Tirjasdyn

Outline Maven

Clair Dickson

A dark core to every cloud