Disastrous Job Losses in Michigan
Baldwin, Marc
DETROIT 't was expected that General Motors would an nounce plant closings. But when the announcement came last November, the scale was astounding: 29,000 workers in 11 plants laid off. Almost...
...Of the affected cities, Flint is the most dependent on the auto industry...
...General Motors employs more than 50,000 workers in Flint, more than onethird of the city's total population...
...2.3 percent of city employment will be lost...
...A UAW study of displaced auto workers found that along with lower wages, of those who were reemployed, 65 percent are in nonunion jobs and only 63 percent of those in new jobs were receiving health insurance...
...The Buick City plant had opened just one year before, having cost $350 million to build...
...The same day that Ward's Automotive News reported the GM closings, it was announced that GM would open two parts plants in joint ventures with Daewoo near Taegu, South Korea...
...The Detroit Free Press could only prescribe more free market to an ailing capitalist economy...
...As a result of the closings, Flint stands to lose $1.5 million a year in income tax and $2.4 million a year in property taxes...
...In Detroit, a reduction in business activity of between 1.5 and 2 percent over the next three years is anticipated...
...The media response to the plant closings has been technocratic and sanitized...
...1,700 jobs were lost...
...In October, prior to the official announcement of the GM closings, a Free Press editorial on GM declared that "Michigan must try . . . to remove every unnecessary impediment it can to investment and jobs creation in this state...
...A Bureau of Labor Statistics study on workers who lost their jobs between 1979 and 1984 found that workers displaced from the auto industry who found new jobs suffered an average loss in gross weekly earnings of 25 percent...
...In August, the Saginaw Nodular Iron Plant, a GM subsidiary, was given up after a failed employee ownership bid...
...It is also 50 percent more than GM expects to save by closing nine plants and partially closing two others, laying of 29,000 workers...
...GM is also expected to open twelve new plants in Mexico in 1987, giving it twenty-nine plants in that country...
...As many as 87,000 Michigan jobs could be lost when the ripples spread through the state economy...
...Auto analyst Maryann Keller says, "The decision should have been made years ago...
...The sum of this "hushmail" (Perot's phrase) is equal to 18.75 percent of GM's 1985 profits...
...Twelve percent of total city employment will be lost...
...While laying off American workers, GM was simultaneously engaging in joint ventures in a country that is notorious for trade union repression...
...The Michigan plants are in Detroit (2,500) and Orion Township (1,000 workers...
...Hutton, said the GM announcement was "long overdue, and it's hard to see anything bad about it...
...The closings will directly affect 16.1 percent of the city's work force...
...In all estimates, the full impact, including on suppliers, could be considerably greater...
...For Flint, the bad news follows the indefinite layoff of 1,300 workers earlier in the year at the Buick City plant...
...Since the military coup in 1980, the ability of workers to bargain collectively has been even more tightly contained...
...The Monday after Perot's resignation, GM stock fell by $1.38...
...Wage losses of almost $200 million are possible...
...And in December, further indefinite layoffs were announced in three of GM's most modern assembly plants, two in Michigan, affecting a total of 4,50C workers...
...Industry analysts cite a range of corporate woes and declare the employee bloodletting a necessary evil...
...The average wage rate in Mexico is less than a dollar an hour...
...A Detroit Free Press columnist, citing these remarks, reminded analysts: "The least we can do is remember they are people, for God's sake, not statistics...
...In Pontiac, the mayor's office estimates that the GM closings will cost between $600,000 and $800,000 in lost income tax revenue...
...Traditionally, such phrases mean antiunionism, low wage rates, low job security, and reduced protection for workers...
...This is in addition to the previously announced closing of a GM foundry...
...Other Michigan cities have also been affected...
...ALTHOUGH THE UAW HAS NEGOTIATED an array of protections for laid-off workers, many of the directly affected workers will never recover their buying power...
...Joseph Phillippi, an analyst for E.F...
...The logic of the Reagan era is: to an economy out of control, less control...
...Workers' rights were severely limited under martial law in 151 Korea throughout the 1970s...
...Three Michigan cities bear most of the burden: Flint: 3,230 unemployed auto workers by the end of 1987 3,450 truck and bus workers by August 1987 Pontiac: 1,270 auto workers by the end of 1987 2,200 truck and bus workers, August 1988 Detroit: 6,600 auto workers by the end of 1987 700 at Conner Stamping by 1990 Other closings and layoffs have been announced...
...Almost twothirds of the affected unionized workers (17,450) live in Michigan...
...Adding farce to tragedy, the GM closings were followed by the buy-off of H. Ross Perot and three other corporate malcontents for $750 million...
...Lost property taxes could amount to $1.02 million a year...
Vol. 34 • April 1987 • No. 2
