Factory workers and lawyers

May 25, 2011

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A Fiscal Times article posted on money.msn.com May 23 noted that the U.S. labor market has been looking stronger in recent months as private-sector companies have added two million workers since early 2010, with the "overwhelming bulk" coming from small businesses.  As reported, so far this year, payroll increases have accelerated to 214,000 per month, the strongest four-month pace in five years.

But, as the article states, there's a catch.

"The quality of the jobs the U.S. is creating right now in terms of pay, benefits, hours, and skills leaves a lot to be desired. The problem is not only the depth of the recession and the sluggishness of the recovery. It also reflects the changing structure of the U.S. economy, as more manufacturing operations shift to overseas locations, while service businesses, which often pay much less, take a more dominant role in job creation.

"Previously high-paying jobs in manufacturing have gone the way of the Edsel. U.S. factories lost 3 million jobs from 2000 to 2004, jobs that did not return during the boom leading up to the recession, along with another 2.2 million from 2007 to 2010. Those are unlikely to come back, as well. Manufacturing jobs were 20 percent of private-sector payrolls in 1990, 15 percent in 2000, and just over 10 percent in April. Large multinational corporations have cut 2.9 million U.S. jobs over the past decade, while adding 2.4 million workers to their overseas operations."

These are big losses and big news. But that doesn't mean that manufacturing jobs are not being created in this country. Small numbers are being added here and there, such as the 65 jobs Cadence Inc. will add as a result of its $15.9 million expansion of its Staunton, Va., operation. Once known as Specialty Blades, the company, which has operated in Staunton for 25 years, makes cutting and piercing tools for industrial and medical uses.

In nearby Waynesboro, Va., PPI-Time Zero Inc., is adding 65 new jobs as it invests $1.15 million to establish operations at Solutions Place. The contract electronics manufacturer is based in Paterson, N.J.

These two businesses, along with others like them, are helping create manufacturing jobs, albeit it in small numbers. Some larger businesses are adding jobs in greater numbers.

As reported on foxbusiness.com, GM is adding 2,500 hourly and salaried jobs at its Detroit-Hamtramck plant, which will manufacture the new Chevrolet Malibu and the next-generation Impala, as well as electric cars — the Chevrolet Volt and Opel Ampera.

Quoted in the article is GM North America President Mark Reuss, who said "Filling this plant with new work is very satisfying because GM is dedicated to helping rebuild this city."

The jobs will be filled by laid-off UAW members with the possibility of new hires to follow.

The additions are part of a plan GM announced earlier this month to create or retain about 4,000 jobs and invest $2 billion in 17 manufacturing facilities in eight states. So far, the company has  added jobs in Bowling Green, Ky.; Toledo, Ohio; and Flint and Bay City, Mich.

But are these manufacturing jobs on par with those of years past?

According to the Fiscal Times article, "pay in manufacturing is not what it used to be. Hourly earnings of production and non-supervisory workers, which had held well above the private-sector average for decades, slipped below the average in 2006, and the ratio continues to trend gradually lower. In 2004, factory pay was about 3 percent above average. In April it was 2.4 percent below the $19.37-per-hour private-sector mark for production workers."

If it's any consolation, even some lawyers are making less. As reported in the New York Times, "the nation’s biggest law firms are creating a second tier of workers, stripping pay and prestige from one of the most coveted jobs in the business world.

"Make no mistake: These are full-fledged lawyers, not paralegals, and they do the same work traditional legal associates do. But they earn less than half the pay of their counterparts — usually around $60,000 — and they know from the outset they will never make partner."

These lawyers reportedly are part of a fundamental shift in the 50-year-old business model for big firms.

"Besides making less, these associates work fewer hours and travel less than those on the grueling partner track, making these jobs more family-friendly. And this new system probably prevents jobs from going offshore.

"But as has been the case in other industries, a two-tier system threatens to breed resentments among workers in both tiers, given disparities in pay and workload expectations."

Who would have thought that factory workers and lawyers would one day have common job concerns?

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Vicki Bell

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