STRUCTURAL CHANGES IN THE AUTO INDUSTRY
by
Robert Cohen
At 35
Research Paper
International Policy Forum
Eagle Lodge, Pennsylvania, U.S.A.
28 June, 1 July, 1981
BUILDING W76
MASSACHUSETTS INSTITUTE OF TECHNOLOGY
CAMBRIDGE. MASSACHUSETTS 02139
Future of the Automobile Program
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DANIEL ROOS. CO-DIRECTOR
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June 1981
THE EMPLOYMENT CONSEQUENCES OF
STRUCTURAL CHANGES IN THE AUTO INDUSTRY
by
Robert Cohen
C/.p.
13
*rP355
Research Paper
International Policy Forum
Eagle Lodge, Pennsylvania, U.S.A.
28 June, 1 July, 1981
The contents of this paper represent the opinions of the author
only and are not necessarily those of the program or its members.
For Internal Auto Program Distribution
Not for Citation, Quotation or Publication
CENTER FOR TRANSPORTATION STUDIES
CENTER FOR INTERNATIONAL STUDIES
THE EMPLOYMENT CONSEQUENCES
OF STRUCTURAL CHANGE IN THE AUTO INDUSTRY
A.
The Post-Lordstown Age and The Transformation
of Work in the Auto Industry: Paradise Regained?
1.
Automakers and the Reorganization of Work in
the Industry
During the 1970s, the U.S. auto industry went
through a dramatic period of change.
Fortune magazine
has recently commented on how "GM made itself over into
the domestic industry's great risk taker,"
replacing its
entire range of cars and setting itself the goal of
becoming a worldwide innovator in manufacturing and product
design.
Its
new J-cars are heralded
by Fortune as "the
company's first attempt to match the Japanese level of
fits and finishes."1
GM's attempt to stay ahead in the
world's auto markets has important consequences for auto
workers who must match the Japanese fits and finishes.
This paper will argue that the Post-Lordstown
Age of the Auto has been marked by the transformation of the
auto industry from a "metal-bending" industry to a more
process-oriented industry.
1 Charles
This change is apparent if
G. Burck, "How GM Stays Ahead," Fortune,
March 9, 1981, p. 48.
2
one links the standardization and simplification of
producing the product, the car, through downsizing, decreasing
the number of parts and drastically reducing model lines to
employment changes currently taking place.
changes include:
The employment
(1) concentrating production in fewer
plants with greater levels of output, utilizing faster line
speeds;
(2) shifting blue-collar jobs towards assembly work
and away from such "craft" jobs as lathing, milling, grinding,
drilling, punching, stamping and painting that can be done by
machines;
(3) hiring more professionals to design equipment
and program computers.
While these changes in employment may seem to be
part of a sophisticated response to the need to increase
productivity by increasing the speed and efficiency in an
industry facing intense foreign competition and high labor
costs, the 1970s appear to mark a watershed in the way in
which work is organized in the industry.
Achieving a more
process-oriented industry appears to be a logical response
by automakers to the problems they face in adjusting to a
world market where competitors have changed the rules of
the game.
The unappreciated problem posed by such a change
is what its consequences for workers will be and what implications new patterns of employment by auto producers and their
parts suppliers will have for the formulation of national
policies that deal with the auto industry.
3
If the thesis of a "Post-Lordstown era" makes
sense, automakers face several crucial dilemmas.
These
revolve around the fact that production in the auto
industry, unlike that in the chemical industry, a process
industry where a few skilled workers can run a large number
of costly machines, requires a great deal of complicated
manipulation and pattern recognition that may not be easily
duplicated by machines.
Thus, the replacement of unskilled
by skilled work is quite difficult.
Although machines may
be devised to do many tasks that can be standardized, bluecollar workers are still more adept at putting cars together.
One dilemma is how to reorganize work for the blue-collar
workers that will remain integral to production in order to
achieve greater efficiency
(fewer cars rejected at the end
of the line--the "Japanese fits and finishes" mentioned
earlier) and greater speeds in production.
A second dilemma is where automakers must go to
achieve the cheaper
(more efficient and less costly) pro-
duction of cars and parts they require without substantially
disrupting the employment patterns and industrial linkages
that have been part of the nation's economy since the early
part of the century.
Already Los Angeles, Detroit and St.
Louis have sizable employment problems because of auto
makers deciding to relocate new plants outside these cities.
4
A third dilemma is the risk automakers face in seeking a
new mix of workers to replace large numbers of those from
older, industrial centers with a long history of union
activity.
There is no guarantee that workers from "green-
field" communities outside declining urban centers will be
less likely to react to the more rapid pace of work in
plants manufacturing 70 cars per hour.
The purpose of this paper is to describe and evaluate
the employment changes that have occurred in the motor vehicle
industry as a whole (SIC 371),
particularly in the auto
industry (SIC 3711) and in the automotive parts industry
directly linked to it (SIC 3714).
This paper will also
identify the most significant policy issues that need to be
addressed because of these employment changes.
The review
of employment changes will focus on several specific
dimensions of change within the auto industry.
This first
section investigates changes in the pattern of employment
and the groups affected by these changes.
This will include
an examination of changes within detailed industries, primarily
SIC 3711, motor vehicles and car bodies (usually referred to
as the auto industry) and SIC 3714, motor vehicle parts and
accessories.
Second, it will review the geographical impact
of employment changes in the auto industry, concentrating upon
the relocation of jobs in the United States.
Third, employment
5
changes at the plant-level and their implications for the
work force will be examined.
The fourth section discusses
parallels between changes in the U.S. industry and its
foreign counterparts.
The fifth section
concentrates on
the policy concerns that are most likely to arise because
of the employment changes in the industry.
The conclusions
of this paper are in its sixth part.
2.
The Transformations of Historical Patterns
of Employment and Its Policy Relevance
At its peak in 1978-1979, the U.S. auto industry
employed over one million workers (over four-fifths of
which were production workers) and consisted of 300 manufacturing facilities with the capacity to produce 14.7
million vehicles.
In 1980, one of the industry's worst
years in its history, over 300,000 auto workers lost their
jobs as production declined to about 9 million vehicles.
By August, 1980, 32 percent of the hourly work force of the 4
largest auto manufacturers were on indefinite layoff.2
Although the industry's unemployment rate declined
to 12.2 percent in April 1981, employment fluctuations in
the industry have been far more extreme than at any time in
the past decade. 3
Indeed, some observers expect the structural
U.S.
Department of Transportation, Office of the
Secretary of Transportation, The U.S. Automobile Industry,.
1980, pp. 83-85 (hereafter referred to as the Goldschmidt Report).
3 See
Table 1.
UNITED STATES
Table 1
Unemployment Rate - Workers in the Automobile Industry
.Jan. 1970 - Feb. 1981
(Seasonally adjusted)
JAN
FEB
1971
6.8
4.5
12.9
5.2
1972
1973
4.9
1.5
4.4
0.5
1974
1975
8.4
23.1
7.3
3.5
3.2
5.2
18.4
18.1
11.6
1970
1976
1977
1978
1979
1980
1981
SOURCE:
22.7
5.6
4.9
3.3
4.7
16.0
18.9
MAR
6.2
4.4
4.0
1.3
12.8
20.2
5.1
3.6
3.1
4.2
15.7
/6617
8.6
18.6
5.0
3.5
2.7
5.9
21.0
4.1
3.5
4.1
9.2
10.0
5.4
15.0
10.7
4.7
4.8
4.1
7.3
11.7
6.6
3.8
5.0
9.9
18.6
1.0
9.3
15.9
6.2
3.3
4.2
7.9
7.1
15.2
6.7
4.2
2.8
6.4
24.2
4.1
28.6
5.1
4.4
2.4
6.9
13.1
6.6
1.3
7.1
3.5
3.5
4.3
24.6
5.2
8.9
12.8
5.0
2.2
16.6
5.4
4.2
4.2
5.7
3.1
1.6
7.0
5.3
6.3
4.7
6.9
5.4
7.8
4.3
4.9
4.6
5.3
6.0
AVG
6.0
8.3
4.9
3.7
8.3
5.3
JUN
5.1
4.3
DEC
OCT
AUG
MAY
NOV
9.2
SEP
JUL
APR
3.1
3.6
7.1
.11.9
21.3
4.1
8.5
21.6
4.4
5.2
11.6
15.5
2.7
9.3
16.0
6.0
3.9
3.0
4.9
13.2
17.5
4.1
7.4
20.3
U.S. Department of Labor
Bureau of Labor Statistics
March 16, 1981
(r-ed(SeA
I'l~ )
0C)
t
8
changes taking place in the industry will mean that about
150,000 auto workers will remain on indefinite layoff, without
much chance of being recalled, if 9.5 to 10 million cars are
manufactured in the U.S. in 1981 and production levels do not
return to their former peaks.4
The shock wave of change has
been even more dramatic in the supplier sector of the industry,
where two different estimates of layoffs in July and October
of 1980 recorded between 350,000 and 650,000 unemployed. 5
Thus, recent employment upheavals inthe auto industry
and among its parts suppliers have been substantial.
unclear how permanent these changes will be.
It is
While the level
of unemployment has dropped back, it remains high.
At the
same time automakers face considerable pressures to increase
their productivity and profitability in domestic operations
that will most likely have additional consequences for employment.
These include a greater automation of production, the
shift to smaller cars with fewer and less weighty parts, and
a greater dependence on foreign sourcing of parts. and components,
4 John
O'Donnell and George Byron, "Facilities Planning
and Regional Employment Assessment," Department of Transportation Systems Center, December, 1980, as cited in Goldschmidt
Report, p. 85.
5 The
first estimate from the Congressional Budget
Office is based on supplier industry labor requirements of
105 workers per 100 jobs in the motor vehicle industry (SIC
See Congressional Budget Office, Natural Resources and
371).
Commerce Division, "Current Problems of the U.S. Automobile
Industry and Policies to Address Them," July 1980, pp. 21, 23.
The second estimate is based on testimony by Howard Samuels to
the U.S. International Trade Committee, October 8, 1980.
9
including such major components as engines and transaxles
(front-wheel drive axles and the new transmissions that are
produced as a single component for front-wheel drive (FWD)
cars).
Additional pressures arise from the fact that the
U.S. market for autos (and trucks), far from remaining an
isolated market in
international terms as it
years after World War II,
cars.6
had been in the
is now part of a global market for
This has several consequences.
Among the more well-
known is the increasing foreign share of domestic auto sales,
28.2 percent in the third quarter of 1980, up from an average
level of 15 percent prior to the 1973 oil crisis.
Less well
appreciated has been the growing sourcing of auto parts and
components from overseas, by both U.S. automakers and foreign
automakers with U.S. operations.
Imports of such parts into
the U.S. rose from $193.2 million in 1965 to $6.965 billion
in 1979.7
The changes in the historical patterns of employment
mentioned above raise important policy questions.
These are
especially important to raise at the beginning of this paper
because employment changes in the auto industry probably
6 For
a discussion of this trend, see my article,
"Brave New World of the Global Car," Challenge, May/June
1981, pp. 28-35.
7 Unpublished
data from the U.S. Department of
Commerce, Bureau of Economic Analysis, Balance of Payments
Division.
10
represent a structural, or significant point of transformation, rather than a cyclical phenomenon.
If this assumption
is accepted--recent events in the industry certainly appear
to argue for its veracity--then the following are some of
the significant policy issues that need to be resolved in the
next few years:
1. An industry, such as the auto industry,
experiencing a period of structural change,
is marked by uncertainty in terms of industrygovernment relations, employment opportunity
and employment distribution, the relationship
between energy policy and auto purchases and
auto production, and the competitive position
of the U.S. auto industry in the world economy.
What policies can best serve to stabilize these
uncertainties and restore some degree of stability
to employment?
2. Given the assumed differences in the cost of
producing cars in the U.S. versus producing autos
abroad, what policies can best restore productivity
in the U.S. and strengthen the stability of employment in the U.S., or must policies be devised to
adapt to a permanent shrinkage of the industry due
to the inability of U.S. industry to compete in a
more internationalized market?
11
3. In adapting to change, firms may often face the
choice of increasing their corporate debt or closing
plants or restricting planned product offerings-both of the latter resulting in decreased domestic
employment.
Is there a role for government influence
in such corporate decisions to help protect domestic
jobs?
4. What policies can be adopted to assure that job
displacement in the auto industry, where jobs are
highly geographically concentrated, does not result
in the stagnation of local economies with few
opportunities for displaced workers?
5. What policies need to be adopted to assure the
mobility of workers who will most likely be displaced
either because of the increased productivity or
greater overseas sourcing that firms will probably
depend upon to revitalize their competitiveness,
unless production greatly exceeds former high levels?
6. What national policies towards adjustment problems
in the auto industry can be adopted to assure that
the gains in national income by workers in new plants
in some regions are not offset by a drain on national
income due to the social costs of assisting unemployed
workers in areas where plants have closed?
12
7. Most U.S. policies formulated to deal with unemployment
have concentrated on helping workers survive cyclical
downturns.
The auto industry, however, provides a
significant case of structural change with substantial
job loss, with a long period of adjustment for the
industry, for workers and for local communities.
What
sort of shift in policy emphasis needs to occur to
respond to the different circumstances of the present
situation?
These are some of the main policy questions that will
be discussed later in this paper.
They should be kept in
mind as the employment changes in the industry are reviewed.
3.
Recent Employment Changes in the Auto Industry
a.
Corporate Adaptations to Change
and Their Employment Consequences
Employment changes in the auto industry reflect many
of the pressures facing an industry attempting to adjust to
a transformed global market for cars.
Three main trends are
apparent in corporate adaptation to change, including downsizing of cars, a shift to front-wheel drive and the redesign
of major components.
But these adaptations have had several
significant reperscussions for labor, a number of which have
not been that well appreciated.
These include:
13
1. The elimination of large car production and the
work of the foundries and engine complexes that
supported such production.
2. Shifts to more efficient production facilities,
often operating at line speeds of 70-;75 units per
hour compared to previous speeds of 45-60 units
per hour and requiring less workers (4500 compared
to 5400 in more traditional plants).
3. Increased use of robotics and other mechanically
or electronically-controlled labor saving devices.
4. Greater reliance by motor vehicle producers and
parts suppliers on foreign sourcing of parts and
major components.
5. Maintenance of a free market for trade in cars,
with some restrictions, for the foreseeable future.
Each of these five consequences for labor has been
estimated to have specific employment impacts. 8 But it is
difficult at the present time to specify how much each of these
changes has contributed to the current employment decline.
Some of the main causes of the present decline in employment
among automakers and their parts suppliers are well-known:
1. From 1978 to 1980, domestic auto manufacturers
closed or announced the closing of 20 plants that
Carol MacLennan and John O'Donnell, "The Effects of
the Automotive Transition on Employment," pp. 1-4-21 and
1-4-23.
14
employed 50,000 workers.
2. Over the same period, parts suppliers closed 100
plants that had formerly provided jobs for more
than 80,000 workers.9
reasons.
These plants closed for two
First, some parts, such as rear axles,
were no longer used in great numbers in front wheel
drive cars.
Second, some parts producers were
displaced by foreign suppliers.
3. In a number of cases, auto firms announced the transfer
of plants from older, industrial urban centers to
new "greenfield" locations with little history of
industrial production.
These are located primarily
in suburban and southern places.
Prior to making
this transfer, employment at some plants has been
drastically reduced or plants have been closed (GM
relocations out of St. Louis, Detroit and Pontiac,
Michigan, for example).
4. Lower sales of cars by domestic producers due to both
the economic downturn and the greater penetration of
the U.S. market by foreign imports (which rose to 27.5
percent of new car sales in the first nine months of
1980, compared to 22.0 percent in 1979) led to decreased
output and layoffs among auto manufacturers and parts
producers.
9 Ibid.,
p. 1-4-7.
15
Thus, while the number of auto workers on indefinite
layoff is still substantial, although lower than during last
summer, additional work needs to be done to estimate how
great the longer-range employment impact of the current
restructuring of the industry will be.
A few estimates of
the employment impacts of increased production efficiencies
have been made.
These estimates are:
(1) that a producer
would require 23,000 fewer workers and three fewer assembly
plants to produce 2 million cars, if modern plants run at
70-75 units per hour and require 4500 workers in place of
5400; and (2) that increased mechanization over the next 10
years may displace as many as 100,000 workers. 1 0
b.
The Size of Employment
Dislocations in the
Auto Industry
As noted in Table 1 above, unemployment levels have
fluctuated widely, particularly during the last two downturns
in the industry, having peaks of 23.1 percent and 28.6 percent
unemployed in January 1975 and May of 1980, respectively.
Table 2 presents unemployment rates for the industry with
breakdowns by sex.
This table shows that on an annual basis,
the most recent decline has been more sizable and rather
disastrous for women workers.
10 Ibid., p. 1-4-22.
16
Table 2
Unemployment Rates in the Automobile Industry
by Sex, Annual Averages, 1967-1980
(SIC 371)
Total
Men
Women
1967
4.0
3.9
4.8
1968
2.4
2.3
3.7
1969
3.0
2.7
5.0
1970
7.0
8.2
1971
1972
5.1
4.4
6.8
4.9
4.3
1973
2.4
2.3
2.9
1974
9.3
9.0
11.5
1975
16.0
15.9
17.2
1976
6.0
5.6
7.9
1977
3.9
3.6
5.4
1978
4.1
4.0
4.9
1979
7.4
7.0
9.3
1980
20.3
18.8
27.7
6.4
4.7
SOURCE: U.S. Department of Labor, Bureau of
Labor Statistics, Employment and Earnings,
January issues.
17
To contrast the most recent downturn with previous
declines in the 1970s, data on employment changes for the
motor vehicle industry (SIC 371) and for production workers
in the industry and in its two most important subindustries
(SIC 3711 and 3714) are presented in Table 3.
For the
industry as a whole, the recent downturn has had a greater
effect on production workers, although the recent decline
has not been as severe as the decline in 1970.
However,
nearly half of the workers in the motor vehicles and car
bodies industry
(SIC 3711, largely auto assembly, engine
production, etc.)
and its related parts industry
(SIC 3714)
were unemployed at the lowest point of the decline.
In fact,
the impact on workers in the parts industry was more severe
during the most recent decline than it was during the 1970
recession.
This suggests that the current employment downturn
in the industry has had a greater impact on parts producers
than is usually believed.
Most previous data on unemployment
in the parts industry suggested that one-third of workers were
unemployed.
This was based upon a poll of -26 major parts
suppliers conducted by Ward's Automotive Reports
1980.
in May
However, the current data suggests that smaller supplier
1 1 Ward's
Automotive Reports, May 19, 1980 noted that
8,000 employees at Dana or 25 percent were unemployed as were
2,750 or 19 percent of employees at Sheller-Globe, 1,800 or
66 percent at Bendix.
18
Table 3
Peaks and Troughs in Employment in the Auto Industry
SIC 371 Motor Vehicles and Equipment
All Employees (thousands)
Peak
December 1978
Trough
Decline
Percentage
Decline
686.2
371.5
35.1%
728.0
287.3
28.3%
571.0
373.1
39.5%
1,057.7
August 1980
1,015.3
October 1973
February 1975
September 1969
944.1
November 1970
SIC 371 Motor Vehicles and Equipment
Production Workers (thousands)
Peak
December 1978
Percentage
Decline
483.8
348.9
41.9%
532.3
251.7
32.1%
381.5
354.6
48.2%
784.0
February 1975
September 1969
November 1970
Decline
832.7
August 1980
September 1973
Trough
736.1
19
Table 3 (continued)
SIC 3711 Motor Vehicles and Car Bodies
Production Workers (thousands)
Peak
Trough
Decline
Percentage
Decline
377.1
May 1979
August 1980
September 1973
February 1975
358.2
September 1969
358.5
November 1970
196.7
180.4
47.8%
236.0
122.2
34.1%
139.0
219.5
61.3%
SIC 3714 Motor Vehicle Parts and Accessories
Production Workers (thousands)
Peak
December 1979
July 1980
387.7
November 1973
361.8
February 1975
November 1969
November 1970
Trough
Decline
Percentage
Decline
222.7
165.0
42.6%
245.2
116.6
32.2%
200.2
122.7
38.0%
322.9
SOURCE: U.S. Department of Labor, Bureau of Labor Statistics
20
firms were more severely affected than larger parts
producers.
b.l.
Employment Changes. by Sex
The effect of recent declines in auto industry
output on female employment are presented in table 4.
These results, derived from surveys of payroll employment,
indicate that women in the auto industry (SIC 371) were affected about as much as other employees during the recent
decline.
However, they also show that women were less
affected by earlier downturns, particularly the 1970 decline,
in both the industry as a whole and its two main parts.
This
suggests that over the past few years, there has been an
increase in the share of women who are new employees with
less seniority.
The decline in women's employment in both
SIC 3711 and SIC 3714 between 1979 and 1980 was less than for
production workers in these industries.
However, using household survey data, Norman Bowers
of the Bureau of Labor Statisticsl2 argues that women were
more vulnerable to the recent layoffs.
He found that from
May 1979 to June 1980 females accounted for 22.8 percent of
the decline in employment, while making up 17.5 percent of
1 2 Norman
Bowers, "Recent Developments in the
Automobile and Steel Industries," U.S. Department of Labor,
Bureau of Labor Statistics, unpublished paper, July 1980.
21
Table 4
Peaks and Troughs in Female Employment
in the Auto Industry
(thousands of employees)
SIC 371
Motor Vehicles and Equipment
Peak
May 1979
Percentage
Decline
Trough
Decline
96.3
53.9
35.9%
72.7
33.5
31.5
58.1
23.1
28.4
Trough
Decline
Percentage
Decline
36.9
24.3
39.7%
25.9
14.4
35.7%
150.2
August 1980
November 1973
March 1975
106.2
October 1969
81.2
November 1970
SIC 3711 Motor Vehicles and Car Bodies
Peak
May 1979
August 1980
November 1973
61.2
40.3
March 1975
October 1969
November 1970
29.1
19.8
9.3
32.0%
22
Table 4
(continued)
SIC 3714
Motor Vehicles Parts and Accessories
Peak
December 1978
November 1973
March 1975
59.3
October 1969
November 1970
48.1
See Table 3
Decline
48.4
33.3
40.8%
40.9
18.4
31.0%
34.5
13.6
28.3%
81.7
July 1980
SOURCE:
Percentage
Decline
Trough
23
employed at the peak.
Using household data for the November
1973 to March 1975 decline, Bowers found that females
accounted for 12.3 percent of the decline in employment and
held 12.9 percent of jobs at the peak.
Payroll data for the
same recession had female jobs accounting for 13 percent of
tie jobs lost, although women held 10.5 percent of jobs at
the peak.
Are women employed in blue collar jobs more vulnerable
to layoffs than men?
Equal Employment Opportunity Commission
data published by General Motors suggests that they are,
particularly in the more sizable blue-collar categories
Table 5).
(see
In the largest category, operatives, women accounted
for 22.3 percent of the jobs in 1978 and 21.6 percent in 1979.
Females represented 27.9 percent of those operatives that were
layed off.
A disproportionate number of women were also dis-
missed from jobs as laborers, but women were less affected
than men by layoffs among service workers and craftsmen,
although it should be noted that their share of jobs in the
latter category is minuscule.
Between 1979 and 1980, however,
women were less affected by layoffs of blue collar workers,
particularly among operatives and laborers.
Thus, among
employees at General Motors, women blue collar workers appear
to be more vulnerable to initial layoffs, but less subject to
later cutbacks.
By way of contrast, minority blue-collar
employees at G.M. were more vulnerable to job losses throughout
24
Table 5
GENERAL MOTORS U.S. EMPLOYMENT AT DECEMBER 31, 1980*
MINORITY EMPLOYES
YEAR
TOTAL
EMPLOY
MENT
1978
1979
1980
1978
1979
1980
1978
1979
1980
1978
1979
1980
1978
1979
1980
56,535
56,844
51,918
36,457
38,264
36,206
12,840
13,254
11,971
4,977
4,789
4,155
40,740
37,998
33,949
Total WhiteCollar Employes
1978
1979
1980
Craftsmen
(Skilled)
JOB CATEGORY
Officials and
Managers
TOAWOETTL
AL WOMEN
EMPLOYMENT %
ASIAN
TOTAL
AMERICAN HISPANIC
INDIAN
EMPLOYMENT
%
5.7
6.4
6.3
14.0
15.4
15.8
14.8
16.5
17.3
8.2
9.1
9.2
55.6
58.3
58.8
4,243
4,453
3,956
1,941
2,192
2,135
1,123
1,160
1,083
390
402
369
6,115
5,867
5,033
111
127
112
515
614
632
123
135
128
23
25
25
241
220
211
200
219
196
98
101
111
31
37
42
23
20
22
168
140
134
544
524
444
322
389
406
197
223
192
73
76
58
1,045
1,034
940
5,098
5.323
4,708
2,876
3.296
3,284
1,474
1,555
1,445
509
523
474
7,569
7,261
6,318
9.0
9.4
9.1
7.9
8.6
9.1
11.5
11.7
12.1
10.2
10.9
11.4
18.6
19.1
18.6
151,549
151,149
138,199
33,283 22.0
34,299 22.7
31,374 22.7
13,812
14,074
12,576
1,013
1,120
1,108
520
517
505
2,181
2,246
2,040
17,526
17,957
16,229
11.6
11.9
11.7
1978
1979
1980
1978
1979
1980
1978
1979
1980
1978
1979
1980
102,901
100,020
99,136
378,145
332,663
301,302
29,825
21,543
22,275
17,979
17,894
16,723
1,100
1,211
1,305
84,426
71,736
66,664
4,012
2,687
3,095
2,474
2,507
2,339
1.1
1.2
1.3
22.3
21.6
22.1
13.5
12.5
13.9
13.8
14.0
14.0
6,883
6,571
6,706
82,379
69,868
63,277
5,619
4,239
4,127
4,319
4,265
3,742
132
129
140
914
833
718
123
87
73
29
32
36
240
232
221
829
780
675
62
46
39
48
39
50
1,421
1,415
1,402
13,510
11,310
10,046
1,169
904
898
667
660
583
8.676
8,347
8.469
97,632
82.791
74,716
6,973
5,276
5,137
5,063
4,996
4,411
8.4
8.3
8.5
25.8
24.9
24.8
23.4
24.5
23.1
28.2
27.9
26.4
Total BlueCollar Employes
1978
1979
1980
528,850
472,120
439,436
92,012
78,141
73,403
17.4
16.6
16.7
99,200
84,943
77,852
1,198
1,081
967
1,179
1,097
985
16,767
14,289
12,929
118.344
101,410
92,733
22.4
21.5
21.1
Grand Totals
1978
1979
1980
680,399
623,269
577,635
125,295 18.4
112,440 18.0
104,777 18.1
113,012
99,017
90,428
2,211
2,202
2,075
1,699
1,614
1,490
18,948
16,535
14,969
135,870
119,368
108,962
20.0
19.2
18.9
Professionals
Technicians
Sales Workers
Office and
Clerical
Operatives
(Semiskilled)
Laborers
(Unskilled)
Service Workers
3,240
3,610
3,252
5,088
5,896
5,727
1,900
2,192
2,065
410
436
384
22,645
22,165
19,946
BLACK
*lncludes employes on short-term leave and temporary
lay-off,
as required for statistical reporting purposes.
EQUAL EMPLOYMENT. Even though GM's total U.S. employment at year-end 1980 was 45,632 below the 1979 level,
the representation of women and minorities was virtually unchanged from 1979.
Source: 1981 General Motors Public Interest Report, p.29.
25
the decline, with the exception of those who were craftsmen
and laborers.
The peculiar trend in female layoffs during the 19781980 decline at GM may be related to the concentration of
women's employment in several parts of the firm's operations.
Women are usually highly concentrated in plastics molding
and trim plants, or in these operations within larger assembly
Because of the greater shift to plastics in small
plants.*
cars, some jobs that are predominately held by women may be
more insulated from change than others.
b.
2.
Employment Changes by Race
There is a limited amount of data on the status of
blacks and other minorities in the auto industry's workforce.
The household'survey of the Bureau of Labor Statistics used
here provides continual estimates of employment, but they are
not seasonally adjusted and are subject to considerable error
because of the small nature of the sample.
The Census of
Population and Census of Manufacturers would be more reliable,
but they do not cover the period of the most recent decline.
Using household survey data, Bowers has noted that the
effects of both the 1979-1980 recession and the 1973-1975
recession were more severe for blacks than for other employees.
*
The author has noted this concentration in sex and
race data on plants published annually by Ford.
1 3 Ibid.
It should be noted that since data on blacks
are based on a household survey that depends upon respondents
26
In 1979, Blacks held 16.4 percent of all jobs at the peak
of employment but amounted for 26.8 percent of the jobs lost.
This experience was very similar to the 1973-1975 period,
when blacks held 17.7 percent of all jobs at the peak but
accounted for 22.9 percent of the positions that were lost in
the decline.
The disproportionate loss of black jobs during the
decline raises the question of whether black blue-collar
workers are more vulnerable to layoffs than their white
counterparts needs to be examined.
Focusing on blacks at
GM during the last decline, excluding other minority workers,
we find that blacks accounted for 21,348 of the blue collar
jobs lost between 1978 and 1980, or 23.9 percent of these
jobs
(see Table 5).
However, blacks held only 18.8 percent
of GM's blue collar jobs in 1978.
Among operatives, where
blacks held 21.8 percent of jobs at the peak, they accounted
for 24.9 percent of 1978-1980 job losses and 27.5 percent of
the 1978-1979 job losses.
Again, the explanation of the pattern of job losses
among blacks may be related to the fact that, like women,
they are more highly concentrated in certain parts of the
to identify the industry in which they work there may be
differences between these data and that reported by employers.
27
According to Ford figures, that are probably
industry.
somewhat similar to the situation at GM, blacks are a
majority of the blue-collar workers at stamping plants,
usually accounting for about 75 percent of the workers
in these plants at peak times, and about 50 percent after
a decline.
During the 1979-1980 decline, production was
cut back considerably and stamping plants were particularly
hard hit, possibly accounting for the greater relative loss
of jobs among black blue-collar workers.
4.
Evidence That Structural Changes Have Occurred
in Auto Industry Employment
a.
Evidence Linked to Changes in Production
The data reviewed thus far has primarily focused
on the recent employment declines in the auto industry.
this section addresses the question of whether structural
changes have occurred in auto industry employment.
Two
types of evidence can be gathered to support the contention
that a structural change has taken place: significant
changes in production that have had noteworthy employment
consequences and key changes in the structure of employment
itself.
This section explores the first type of evidence.
Several alterations in the production of cars were
cited earlier as evidence that there had been a significant
28
structural change during the 1970's.
One of these was
the new emphasis on larger plants with greater line speeds
(usually 70-75 cars per hours compared to the former
45-60).
Carol MacLennan and John O'Donnell note that
in the reorganization of its facilities in St. Louis,
GM will open "two highly automated plants that will employ
about 5,000 workers building autmobiles at faster line
speeds with less labor power.
Corvette will increase its
line speed from 10 to 25 cars an hour utilizing approximately
the same number of employees.
Plans for the Wentzville plant
are to increase hourly production to 75 cars an hour
(B-body cars) from the 57 of the Impala/Caprice.
The
workforce at Wentzville will be approximately 4,000 in
1982
(with a potential increase in later years).
By the
time the relocation occurs, GM will have reduced their
workforce by about 3,500 and simultaneously increased
Corvette production by 150% and passenger car production
by 31%."'14
Older plans traditionally ran at much lower speeds.
In 1979, a rather good year, GM's South Gate plant ran at
40 cars per hour while most others operated at 60 cars per
hour.
Few plants, except for Lordstown and Wilmington
(producer of the Chevette),
1 4 MacLennan
bothnewer,
and O'Donnell,
op.
small-car plants,
cit.,
p.
1-4-16.
29
ran at 70 cars per hour.
Productivity data also corroborate
the fact that output per production worker has expanded
greatly over the past decade or two.
Figure 2 documents
the annual 3.5 percent increase in productivity per worker.
The phenomenon that supports the argument that
structural change has occurred most strongly is the recent
wave of closing obsolescent plants and shifting to new ones
with far greater levels of output and higher expected levels
of efficiency.
These shifts are documented in a forthcoming
piece by MacLennan and O'Donnell that describes these
changes among the Big 3.
As mentioned earlier,
there appear to be significant
differences in the size and speed of output that will be
achieved at new plants and retrofitted plants versus those
levels that were common at plants in the early 1970's. 1 5
Additional evidence that a structural change has
occurred comes from the rapid growth in imports of auto
parts and components.
Tables 6 and 7, drawn from the
Goldschmidt Report, document some of the purchases of
foreign components that will be made by U.S. automakers
over the next few years and component sourcing for the
European Erika car.
1 5 Carol
The rapid growth of component production
MacLennan and John O'Donnell, "Automotive
Reindustrialization: Effects on Employment and Communities,"
forthcoming, particularly the section on individual
manufacturer strategies.
30
94
z
C= a8
CLL
>_44
o9
as
ts
C*CS
es
e
(OOi-4961i
8OH 331'ldW3 83d fJldLfo
Source: Congressional Budget Office, Natural Resources and Commerce
Division, "Current Problems of the U.S.Automobile Industry
and Policies to Address Them," p. 35.
31
from Europe, Latin America, and Japan is especially wellillustrated by Table 8.
The recent'rapid growth of component imports may be
closely related to the rather severe impact of the recent
decline of auto production on supplier firms.
Indeed,
following William Abernathy's line of reasoning in his
recent book, The Productivity Dilemma, a period of transformation in the auto industry would be characterized by a
great disruption of existing assembler-supplier relationships, as occurred when Ford moved from wood to metal bodies.
The significant new patterns of sourcing and the ending of
relationships between assemblers and parts suppliers that
produced soon-to-be obsolescent rear-axles and frames support
the contention that a period of structural change has
occurred.
b.
Evidence from Changes in Patterns of Employment
bl.
Significant Changes in Occupational Rates of
Growth
The most fascinating data that depicts significant
changes in the structure of employment in the motor vehicle
industry (SIC 371, that includes auto assemblers, truck
manufacturers and parts manufacturers) comes from the National
Industry-Occupation Employment Matrices of the Bureau of
Labor Statistics.
Tables 9 and 10 are constructed from
Table 6
2
32
FOREIGN SOURCING - RECENTLY-ANNOUNCED COMMITMENTS BY U.S. AUTOMOBILE
MANUFACTURERS TO PURCHASE FOREIGN-MADE COMPONENTS
FOR USE IN DOMESTIC VEHICLES PRODUCTION
Automobile
Manufacturer
Description of
Component
Manufacturing
Source
Intended Use
Approximate
Number of
Comnonents
Period
2.8 liter V-6
Cars
GM de Mexico
<400,000/year
1982-
2.0 liter L-4
with transmission
Mini trucks
Isuzu (Japan)
100,000/year
1981-
1.8 liter diesel L-4
Chevette
Isuzu (Japan)
small numbers
1982-
1.8 liter L-4
J-car
GM de Brazil
250,000/year
1979-
THM 180 automatic
transmission
Chevette
GM Strasbourg
(France)
-250,000/year
1979-
2.2 liter L-4
Cars
Ford-Mexico
-400,000/year
1983-
Diesel L-4
Cars
Toyo Kogyo
150,000/year
1983-
2.0 liter L-4
Minf trucks
Toyo Kogyo
<100,000/year
1982-
2.3 liter L-4
Cars
Ford de Brazil
~-50,000/year
1979-
Diesel 6 cyl.
Cars
BM/Stegr
100,000/year
1983-
Turbo-diesel/4 cyl.
Cars
BM/Steger
Manual transaxles
Front Disc Cars
Toyo Kogyo
Aluminuim Cylinder
heads
1.6 liter L-4
Eurone, Mexico
Electronic Engine
control devices
Cars
Toshiba
Ball Joints
Cars
Musashi Seimibu
1-6 and V-8 enaines
cars
Chrysler de Mexico
<100,000/year
early 1970's
2.2 Liter L-4
K-body
Chrysler de Mexico
<270,000/year
1981
2.6 Liter L-4
K-body
Mitsubishi
1 Million
1981-85
1.7 Liter L-4
L-body (Omni)
Volkswagen
1.2 Million
1978-82
1.6 Liter L-4
L-body
Talbot (Peugeot)
400,000 total
1982-84
2.0 Liter Diesel V-6
K-body
Peuneot
100,000/year
1982-
1.4 Liter L-4
A-body (Omni
Mitsubishi
300,000/year
1984-
Aluminum Cylinder
Heads
2.2 liter L-4
Fiat
AMC
Car comnonents and
power train
AMC-Renault
Renault in France
and Mexico
300,000/year
1982-
VW of America
Radiators, Stamnings
Rabbit
VW de Mexico
250,000/year
1979-
L-4 diesel and gas
Cars
VW de Mexico
300,000 +/year
1982-
G.M.
Ford
Chrysler
replacement)
1985-
100,000/year
19801980-
100,000+/year
1,000,000/.year
19781980-1984
Compiled from Automotive News, Ward's Engine Update, Ward's Automotive Report,
American Metal Market, Detroit Free Press, and Japan Economic Journal.
Source; Goldschmidt Report, p. 56.
SOURCES:
Table -7
EUROPEAN ERIKA CAR COMPONENT SOURCINA
Country
Austria
Belgium
Canada
Denmark
France
Italy
Japan
Netherlands
Norway
Spain
Sweden
Switzerland
U.S.
England, Germany
England
England, Germany
England,
England,
England,
England,
Germany
England,
France
Germany
Italy
Germany
Germany
England, Italy
England, Germany
Components
Radiator and Heater Hoses, Tires
Hood-in Trim, Seat Pads, Tires, Brakes Tubes
Glass, Radios
Fan Belts
Seat Pads, Sealers, Tiers, Underbody Coating, Weatherstrips, Seat Frames, Heaters, Brakes, Master Cylinders,
Ventilation Units, Hardware, Steering Shaft and Joints.
Front Seat Cushions, Suspension Bushes, Hose Clamps,
Alternators, Clutch Release Bearings
Defroster Nozzles and Grills, Glass, Hardware Lamps.
W S Washer Pumps, Cone and Roller Bearings,
Alternators, Starters
Paints, Tires, Hardware
Tires, Muffler Flanges
Radiator and Heater Hoses, Air Cleaners, Wiring
Harness, Batteries, Fork Clutch Releases, Mirrors
Hardware, Exhaust Down Pipes, Pressings, Hose Clamps
Speedometer Gears, Underbody Coatings
Wrench Wheel Nuts, Glass, EGR Valves
Muffler Ass'v, Pipe Ass v, Fuel Tank Filler
Steering Wheel
Tube Ass'Y Steering Column, Lock Ass'y, Steering and
Ignition
Heater Ass'v
Heater Blower Ass'v, Heater Control Quadrant Ass'Y
Nozzle Windshield Defroster
Cable Ass'y Speedometer
Cable Ass'y Battery to Starter
Turn Signal Switch Ass'v, Light Wiper Switch Ass'v
Headlamp Ass'y Bilux, Lamp Ass'y Front Turn Signal
Lamp Ass'y Turn Signal Side, Rear Lamp Ass'v (inc.
Fog Lamp), Rear Lamp Ass'y
Weatherstrip Door Opening, Main Wire Ass'y Tires,
Battery, Windshield Glass, Back Window Glass,
Door Window Glass, constant Velocity Joints
France, Germany
England, Germany
Germany
England, Germany
England, France, Italy
England, Germany
Transmission Cases, Clutch Cases
Rear Wheel Spindles
Front Wheel Knuckle
Front Disc
Cylinder Head
Distributor
USA
England, Germany
England
Germany
England
England, Germany
Germany
Eng., Gem., Swe.
N. Ireland, Italy
England
Hydraulic Tappet
Rocker Arm
Oil Pump
Pistons
Intake Manifold
Clutch
Cylinder Head Gasket
Cylinder Bolt
Carburetors
Flywheel Ring Gear
Steel (body steel and forging barstock) from U.K., Germany, Belgium
France, Italy, Austria (sheet) and Finland (bar).
SOURCE:
Ward's Automotive Reoort
Source: Goldschmidt Report, p. 57.
33
Table 8
Imports and Exports of Automotive Parts, Engines and Bodies
1965-1979 ($ Millions)
Total
Western
Europe
Year
Total All
Areas'
UK
EEC6
1965
193.2
17.6
50.3
71.6
112.8
1970
1464.3
38.7
158.5
207.4
1079.9
1975
3235.4
72.8
324.5
433.3
1976
5146.1
72.4
389.5
1979
6964.9
210.8
1965
867.4
1970
Canada
Latin
America
Japan
Imports
.7
6.9
19.3
151.6
2033.1
207.3
528.1
506.4
3007.9
291.6
1221.7
1058.6
1337.2
3748.8
17.6
32.2
71.3
621.8
115.5
3.5
2236.5
32.1
74.4
148.9
1601.5
274.5
17.0
1975
4993.0
56.0
160.1
314.0
3521.2
648.3
34.9
1976
5908.0
73.0
211.0
397.0
4280.7
668.0
53.4
1979
8445.6
165.1
376.3
667.0
5316.6
1530.4
286.8
568.7
1084.4
Exports
CA)
Source:
U.S. Department of Commerce, Bureau of Economic Analysis, Balance of Payments
Division, Special Tabulations for the Congressional Budget Office Study of the
Auto Industry.
35
occupational data for the auto industry and present those
occupations with more than a thousand employees that
declined or grew a great deal more than the industry did.
One problem in making these comparisons is that the initial
year, 1970, was the bottom of a decline.
Thus, the rapid
growth of non-skilled classifications that expand relatively
more rapidly after a decline, such as assemblers, may be
exaggerated.
With this
caveat in mind,
the employment changes
that are depicted by isolating these specific occupations
are quite interesting.
In Table 9, many of the declining
occupations are traditional "metal-bending" jobs: sheetmetal
workers; job and die setters; tool and diemakers; drill press
operators; punch and stamping press operations; and lathe,
milling machine
operators.
These jobs and others such
as solderers and painters were probably substantially
affected by automation at both assembly plants and parts
plants.
In other cases, employment levels were most likely
changed because of the simplification of design of parts used
in cars, such as seats, in the case of upholsterers.
Auto
firms have continued to simplify the steps needed to produce
seats and to reduce the number of parts used in making them.
The rapidly growing jobs listed in Table 10 include
professional occupations needed for the design of plants and
production and for management of the firm.
They also include
36
Table
9
Selected Occupations in Relative or Absolute Decline in the Motor
Vehicle and Equipment Industry
Total, All Occupations
(SIC 371)
1970
804,62"1
1978
981,5b
Percent
Change
21.99
3,925
3,623
-
7.69
Stock Clerks, Storekeepers
12,445
11,840
-
4.79
Job and Die Setters, Metal
15,756
15,757
Pattern and Model Makers
3,887
3,725
Sheetmetal Workers and Apprentices
2,942
3,206
8.97
Tool and Diemakers and Apprentices
17,257
18,407
6.66
2,591
2,275
-12.20
37,653
38,711
2.81
Crane, Derrick and Hoist Operators
3,942
4,108
4.21
Stationary Engineers
1,348
825
-38.80
Upholsterers
1,733
1,398
-19.33
Drill Press Operatives
4,916
4,128
-16.03
14,272
13,283
Lathe, Milling Machine Operatives
9,060
7,340
-18.98
Other Precision Machine Operators
5,731
4,888
-14.71
24,278
22,612
Solderers
1,130
686
-39.29
Filer, Polisher, Sander, Buffer
9,842
10,395
7.81
18,535
18,592
0.31
Keypunch Operators
Auto Body Repairers
Auto Mechanics and Apprentices
Grinding Machine Operatives
Punch, Stamping Press Operatives
Painters, Mfg. Articles
Source:
0.01
-
-
-
4.17
6.93
6.86
U.S. Department of Labor, Bureau of Labor Statistics,
National Industry--Occupation Employment Matrices,
pages 338-343.
37
Table 10
Selected Rapidly Growing Occupations in the Motor
Vehicle and Equipment Industry (SIC 371)
1970
1978
Percent
Change
804,621
981,568
21.99
Computer Systems Analysts
1,065
1,938
81.97
Economists
1,506
2,862
90.04
Operations, Systems Research
1,656
2,844
71.74
17,867
27,870
55.99
Sales and Sales Workers, NEC
5,988
7,908
32.06
Computer, Peripheral Equipment
Clericals
1,937
5,054
160.92
10,565
14,219
34.33
7,318
10,443
42.70
16,915
23,608
39.57
125,045
178,651
42.87
15,904
21,626
35.98
Total, All Occupations
Other Managers, Administrators
Machinists and Apprentices
Millwrights
Heavy Equipment Mechanics,
Including Diesel
Assemblers
Fork Lift, Tow Motor Operatives
Source:
N.B.
See Table 9.
There is no Page 38 of this paper.
39
skilled workers, such as millwrights and machinists, and
the most numerous non-skilled workers, assemblers.
The occupations represented in these two tables
indicate trends for the motor vehicle industry that support
the argument made earlier that employment changes that have
occurred in the '70's are shifting the industry to a
Most of the declining occupations
process-oriented one.
have been affected because of the need to increase the speed
and level of output.
Among the dynamic occupations, a number
of computer-related jobs and skilled jobs, such as millwrights,
also appear to have been affected by firms' desires to increase
the efficiency and speed of production.
The desire to increase
the speed of "throughput" in the industry is also reflected in
the simplification of the design of parts that took place
even before the recent massive redesign of parts that
accompanied downsizing.
Thus, I would argue that the trends in the early
and mid 1970's were an initial stage in shifting the industry
to a more process-like one.
To determine whether this shift
in occupational composition was discontinuous with past change
in the industry would require repeating this analysis with
earlier data from the 1950 and 1960 Censuses of Population
that provide comparable industry-occupation matrices.
40
b.2.
Significant Changes in Occupational Structure
Two ideas reflected in these occupational trends
need to be explored further--the professionalization of the
white collar work and the relatively greater increase in
assembly workers over the 1970's.
In Table 11, I have
compared the share of professionals in employment in several
industries, including the chemical industry and two durable
goods industries that are usually considered to be more
high-technology and dynamic than the auto industry.
While
the share of professionals in the auto industry was quite
low relative to all manufacturing in 1970, the share has
increased rapidly, particularly when compared to the instruments
and electrical equipment industries.
There is evidence to
believe that this shift to "professionalization" of the auto
industry's workforce will continue, particularly with the
current emphasis on designing new machines and new
cars,
on running more operations by computer and on strategic
planning.
Bureau of Labor Statistics data on employment
for the two largest 4-digit industries in the motor vehicle
industry shown in Table 12 illustrate two different trends.
SIC 3714, the auto parts producers, has become increasingly
white collar over the past 20 years.
The motor vehicle and
car body industry (SIC 3711--the auto industry), however, has
its greatest growth in white collar jobs over the last few
years.
These data, which are compiled from firms with over
41
Table 11
The Changing Share of Professional, Technical and Kindred
Workers in Employment in Selected Industries
Employment
(thousands)
Professional,
Technical,
Percent
Kindred
(thousands) Professionals
Total Manuf acturing
1970
1980
20,737
21,593
2,017
2,454
9.7%
11.4%
1,212
1,286
213
257
17.6%
20.0%
12,258
12,993
1,391
1,678
11.3%
12.9%
1,089
1,010
84
109
7.7%
10.8%
479
604
93
111
19.4%
18.4%
2,019
2,294
358
431
17.7%
18.8%
Chemical s
1970
1980
Durable Goods
1970
1980
of which:
Automobiles
1970
1980
Instruments
1970
1980
Electrical Equipment
1970
1980
Source: U.S. Department of Labor, Bureau of Labor Statistics,
"Employed Persons By Major Occupation Groups, By 2-Digit
Manufacturing Industries," unpublished data.
42
Table 12
White Collar Workers in Total Employment
(Employment in Thousands)
Motor Vehicles and Car Bodies SIC 3711
1960
Total Employment
Production Workers
1970
1975
1980
352.5
352.2
313.0
351.3
251.1
278.7
280.5
270.9
White Collar Workers
61.9
72.6
72.0
81.3
Share of White Collar
Workers
19.8%
20.7%
20.4%
23.1%
Motor Vehicle Parts and Accessories SIC 3714
19,60
1970
1975
1980
361.2
382.1
375.3
351.5
273.0
275.9
273.5
242.0
White Collar Workers
88.2
106.2
101.8
109.5
Share of White Collar
Workers in Total
24.4%
Total Employment
Production Workers
Source:
28.0%
27.1%
31.2%
U.S. Department of Labor, Bureau of Labor Statistics,
Employment and Earnings, United States, 1909-1978, Bulletin
1312-11, 1979; Supplement to Employment and Earnings.
Revised Establishment Data, September 1980; and Employment
and Earnings, March 1981.
43
20
employees,
illustrate the recent change in professional-
ization in the auto industry and suggest that a similar
Given
trend began much earlier among larger parts producers.
the increased propensity of Ford and Chrysler to depend upon
outside parts suppliers, one would expect the share of white
collar workers in
SIC 3714 to continue to grow.
As far as the great increase in assembly workers is
concerned, Table 13 demonstrates that from 1970 to 1979,
operatives jobs, the category including assemblers, did
increase substantially in the motor vehicle industry SIC
371.
During the 1979-1980 decline, however, layoffs among
operatives accounted for the greatest loss of jobs in the
industry.
Thus, the argument introduced earlier of a
structural change leading to more assemblers in the motor
vehicle industry's workforce may or may not be valid.
Figures
from the Equal Employment Opportunity Commission show that at GM
operatives' jobs declined much less than they did for SIC 371,
going from 52.4 percent of total employment in 1975 to 53.4
percent of employment in 1979, and declining to 52.2 percent
of the total in 1980.
Until more recent data becomes
available from industry-occupation matrices, it will be
difficult to substantiate whether this trend represents a
structural change or reflects the usual fluctuations in the
industry.
44
Table 13
Occupational Distribution of Workers in the
Motor Vehicle Industry
(SIC 371)
(Thousands of Employees)
1970
1975
1979
1980
1,089
887
1 ,238
1,010
242
195
271
253
Professi onals
84
84
110
109
Managers
32
28
45
40
122
82
111
97
5
4
5
7
826
692
937
726
CraftsmE n
248
214
263
224
Operati ves
541
445
630
466
37
34
44
37
Other Ser vice Workers
21
26
30
30
White Col Lar as Percent of
Total E mployment
22.2%
22.0%
21.9%
25.0%
Total Empl oyment
White Coll ar Employees
Clerical s
Sales
Blue Colla r Workers
Laborer s
Note:
Source:
Errors are due to rounding
See Table 11.
45
b.3. Significant Changes in Employment Affecting
Minorities and Women
While minority employment appears to have remained
at the same level throughout the 1970's (in contrast to an
increase during the late '60's, particularly at GM), women's
employment has increased substantially, particularly during
the last five years.
This trend has been noticeable in
both the auto industry (SIC 3711) and its parts suppliers
(SIC 3714),
as described in Table 14.
The relative stagnation of minority employment, in
contrast to the recent rapid growth of female employment,
has occurred at both GM and Ford (see Tables 15 and 16).
Although GM had more female employees than Ford in the
earlier part of the decade, Ford had nearly doubled its
share
of women among hourly, or primarily blue-collar employees.
While the growth of female and minority employment
has been substantial among all categories of white collar
occupations during the 1970's, there has been a growth of
female employment among blue collar workers, in contrast to
the decline of minority jobs in these categories.
The trend
in minority employment at General Motors is of particular
interest.
At GM, minority employment in more skilled
blue-collar occupations (craftsmen and operatives) has
increased from 1974 to 1980, while minority employment among
laborers declined dramatically after 1974 (table 17).
The
46
Table 14
Role of Women's Employment in the Motor Vehicle Industry
Motor Vehicles and
Equipment (SIC 371)
1979
1975
1970
1960
All
Employees
Women
Employees
994.6
792.4
799.0
724.1
140.3
80.5
71.1
68.4
464.2
273.5
275.9
273.0
56.4
28.9
24.7
27.4
12.1%
10.6
9.0
8.9
444.4
352.5
351.3
313.0
75.6
46.1
42.3
41.3
17.0%
13.1
12.0
Percent
Women
14.1%
10.2
8.9
9.4
Motor Vehicles and
Car Bodies (SIC 3711)
1979
1975
1970
1960
Motor Vehicle Parts and
Accessories (SIC 3714)
1979
1975
1970
1960
Sources: See Table 12
13.2
47
Table 15
Year-End Employment of Women at GM
1980
1978
1976
1975
1974
1973
Blue Collar
16.7
17.4
15.5
13.2
12.9
14%
White Collar
22.7
22.0
19.8
18.7
18.6
19%
Combined
18.1
18.4
16.5
14.5
14.3
Year-End Employment of Minorities at
11%
GM
1980
1978
1976
1975
1974
1973
Blue Collar
21.1
22.4
21.1
19.5
19.8
20%
White Collar
11.7
11.6
10.2
8.8
9.0
9%
Combined
18.9
20.0
18.7
16.9
17.1
Source:
Public Interest Reports of
the General Motors Corporation.
1965
1965
13%
Table 16
48
Year-End Employment of Women at Ford
1978
1975
1974
1973
Hourly Employees
12.2%
6.1%
6.9%
7.2%
Salaried Employees
17.1%
14.7%
14.8%
14.8%
Combined
13.7%
8.8%
9.3%
9.6%
Year-End Employment of Minorities at Ford
Hourly Employees
Salaried Employees
Combined
Source:
1978
1975
1974
1973
25.6%
23.3%
24.4%
25.2%
9.6%
6.8%
6.6%
6.8%
19.0%
19.6%
20.9%
18.1%
Annual Reports of Ford Motor Company
Table 17
48a
Representation of Minorities in EEO-l Job Categories
at General Motors at Year End
1980
1978
1976
1975
1974
Officials and
Managers
9.1
9.0
7.6
6.0
6.1
Professionals
9.1
7.9
6.3
5.3
5.1
Technicians
12.1
11.5
9.8
8.0
8.6
Sales Workers
11.4
10.2
8.2
7.1
8.2
Office and Clerical
18.6
18.6
17.6
16.0
16.0
(skilled)
8.5
8.4
7.5
6.7
6.7
(semiskilled) 24.8
25.8
24.5
22.8
22.7
Laborers (unskilled)
23.1
23.4
25.0
24.6
32.9
Service Workers
26.4
28.2
27.2
25.3
26.8
Total
18.9
20.0
18.7
16.9
17.1
Job Categories
Craftsmen
Operatives
Source:
Public Interest Reports of
the General Motors Corporation.
49
share of female employment among blue-collar workers at
GM, which was nearly double that at Ford in 1973, increased
more rapidly among lower skilled workers than for operatives
(see Table 18).
The loss in the share of laborers' jobs
by blacks was offset by the increased share of these jobs
held by women. Similar trends occurred at Ford (see Tables
19 and 20), where the share of female employment in blue-collar
jobs increased quite substantially among laborers and operatives
but did not change for craftsmen.
Since operatives are the largest category of
blue-collar workers (see Table 5),
changes in the share of
minority and female employment in this occupational group
probably tell us more about trends in minority and women's
employment in blue-collar jobs.
At GM, the number of women
in operatives' positions, which was one-fourth less than the
number of minorities in 1974, is now nearly identical to
the number of minorities (see Tables 17 and 18).
At Ford,
the number of women in operatives' jobs was less than one-third
of the number of minorities in these positions from 1973
through 1975.
It has now increased to over half of the number
of these positions held by minorities (see Tables 19 and 20).
Thus, at both Ford and GM, there has been a substantial
rise in the number of women working as operatives.
This job
category is made up primarily of assemblers (36 percent),
semiskilled metalworkers (22 percent--largely grinding machine
50
Table 18
Representation of Women in EEO-l Job Categories
at General Motors at Year End
1980
1978
1976
1975
1974
6.3
5.7
4.1
2.9
2.8
Professionals
15.8
14.0
11.0
9.2
7.7
Technicians
17.3
14.8
10.4
7.2
7.1
9.2
8.2
4.2
3.0
2.2
58.8
55.6
53.9
52.8
51.6
Job Categories
Officials and Managers
Sales
Office and Clericals
1.3
1.1
0.8
0.5
0.5
22.1
22.3
20.3
17.5
17.1
13.9
13.5
11.7
10.2
7.4
Service Workers
14.0
13.8
11.3
10.8
10.4
Total
18.1
18.4
16.5
14.5
14.3
(skilled)
Craftsmen
Operatives
Laborers
Source:
(semiskilled)
(unskilled)
See Table 17.
Table 19
51
Representation of Minorities in EEO-1 Job Categories
at Ford Motor Company at Year-End
Job Categories
1978
1975
1974
1973
Officials and Managers
8.5%
6.0%
5.6%
5.6%
Professionals
9.2
5.3
5.4
5.7
Technicians
8.4
10.5
9.2
9.1
Office and Clerical
17.2
14.1
13.7
14.0
Craftsmen (skilled)
8.5
7.7
7.9
7.7
Operatives (semiskilled)
30.2
27.4
28.5
29.6
Laborers (unskilled)
30.5
30.3
28.4
29.5
Service Workers
27.6
26.8
31.1
31.7
TOTAL
20.9%
18.1%
19.0%
19.6%
Source:
Annual Reports of Ford Motor Company
Table 20
52
Representation of Women in EEO-1 Job Categories
at Ford M6tor Company at Year-End
Job Categories
1978
1975
1974
1973
Officials and Managers
2.7%
1.2%
1.0%
0.9%
Professionals
10.5
5.7
5.6
5.0
Technicians
10.~8
7.5
6.5
5.5
Office and Clerical
46.3
42.7
43.3
45.3
Craftsmen (Skilled)
0.3
0.1
0.3
0.3
16.0
8.3
8.9
9.7
8.2
2.4
4.3
3.2
Service Workers
13.2
8.3
7.3
6.6
TOTAL
13.7
8.8
9.3
9.6
Operatives (Semiskilled)
Laborers (Unskilled)
Source:
Annual Reports of Ford Motor Company.
53
operatives and punch stamping press operators) and semiskilled
packaging and inspecting operatives (13 percent--primarily
checkers and examiners).
The trends discussed here suggest that as car
production has become more standardized and line speeds have
been increased, there has been a concomitant growth in
females in those jobs that are central to assembly line
operations.
A cursory inspection of plant level data for
one of the Big Three suggests that this trend may be more
pronounced in newer, "Greenfield" plants used in the South.
While it is difficult to document this trend to "feminization"
of the blue-collar workforce of the Big Three automakers
in more detail, one must wonder whether there is a direct
connection between the requirement to produce cars to match
"Japanese fits and finishes" and the- shift to women.
Do the
large automakers believe women will be better at producing
cars than males or be less likely to disrupt the flow of.
work than previous workers in the industry?
It is difficult
to answer this question and the industry spokespeople have
not offered many comments on the "feminization" that has
occurred.
B.
The Locational Impact of Employment Changes in the
Motor Vehicle Industry
Previous studies suggested that employment in the
54
1 6 and that
auto industry has shifted to the Sunbelt states
older, industrial cities have been particularly vulnerable
to plant closures. 1 7
This section of the paper will focus
on these locational changes and examine some of the forces
that are responsible for them.
1.
Regional Employment Changes
The Goldschmidt Report documented recent closures
of plants by the Big Three automakers, tire manufacturers
and steel producers that suggested that the areas most
vulnerable to change were those Great Lakes and Northeastern
states where most auto industry employment was concentrated
(See Figure 3).
(Estimates for this analysis were prepared
by the Department of Transportation's Transportation System
Center
in
(TSC) and often included data for parts suppliers
the state and city data that was compiled for the
Goldschmidt Report (see Table 21)).
To extend this analysis to a national level, statistics
for two 4-digit industries, SIC 3711 (motor vehicles and
car bodies--What I have previously referred to as the auto
industry) and SIC 3714, motor vehicle parts and accessories,
were examined for all states for which data were disclosed
.
16
Goldschmidt Report,
1 7 MacLennan
pp.
86-95.
and O'Donnell, "The Effects of the
Automotive Transition on Employment," pp. 1-4-12 to 1-4-20
discusses the effects of change in the auto industry on
St. Louis.
I I
Figure 3
AUTO, STEEL, AND TIRE PLANT CHANGES
1975-1980
Ul
Source: Goldschmidt Report, p. xviii.
56
Table 221
AUTO-RELATED EMPLOYMENT BY STATE AND AREA
Number
of Plants
STATE
Michigan
Ohio
Indiana
New York
Illinois
Auto
Employment
Auto Employment
as %of Manufacturing Employment
July 1980
Unemployment
136
51
33
14
12
365,000
186,260
94,300
65,100
38,200
30
13
13
4
3
14.8
10.2
11.3
8.1
9.9
78
16
7
11
9
8
10
11
6
2
201,000
60,800
43,800
41,800
35,900
32,500
26,700
24,400
23,700
23,500
33
69
30
52
13
74
20
65
9
91
14.6
22.2
10.4
9.6
9.2
9.0
8.8
16.8
8.6
20.2
METROPOLITAN
AREAS
Detroit
Flint
Buffalo
Dayton*
Cleveland*
Ann Arbor
Indianapol is*
Saginaw
St. Louis
Anderson
*Rate for County containing the city listed above.
SOURCE:
John O'Connell, TSC, and Carol MacLennan, NHTSA,
"The Effects of the Automobile Transition on Emoloyment:
A Plantand Community Study," December 1, 1980.
Source: Goldschmidt Report, p. 87.
57
by the Bureau of Labor Statistics
(BLS).*
This permitted
me to analyze locational changes in the auto industry and
in
industry.
the parts
a. Locational Changes in the Auto Industry Employment
As noted in Table 22, there has been an almost
10 percent decline in the share of jobs in SIC 3711
(the
auto industry) in the Great Lakes region over the 1975-1979
period.
Growth in
the Southeast,
Soutwest,
Plains and Far
West regions accounted for the increased share of jobs in
these locations, with the Southeast and Southwest showing the
most rapid rates of growth.
Among states, Georgia,
Pennsylvania,
New Jersey, Oklahoma and California showed the fastest rates
of growth.
The fact that 1975 was the bottom year in a
decline and 1979 was one of recovery mayaccount
for some of
these patterns of rapid growth in places such as Pennsylvania,
New York and California.
But the rapid growth in Oklahoma
resulted from GM's opening of its new plant in Oklahoma City.
Georgia's increase in employment was most likely the result
of adding a shift to GM's plant in Doraville.
*Data from the BLS did not include all states. This
was not a great problem because, with the exception of a few
states having approximately 5,000 to 6,000 employees, such as
Maryland and Delaware, the underreporting is negligible. BLS
statistics may differ significantly from those recorded in the
Census of Manufacturers or Census of Population since the BLS
does not include establishments with less than 20 employees in
for SIC 3714 far more
This would bias results
its
surveys.
than those for
SIC 3711.
58
Table
22
Geographical Distribution of Employment
in the Motor Vehicle Industry
SIC 3714
SIC 3711
Quarter
1975
Last
Quarter
1979
Quarter
1975
Quarter
1979
New England
0.7%
1.0%
1.2%
1.1%
Mideast
6.7
6.8
12.0
11.3
76.1
71.2
70.5
66.2
First
Region
Great Lakes
First
Last
Southeast
2.6
3.8
7.2
10.7
Plains
6.8
7.8
4.1
4.2
Southwest
1.8
2.9
1.6
2.0
.3
.5
3.1
4.1
Rocky Mountains
Far West
.1
5.2
.04
6.5
335,343
418,458
344,719
415,509
New York
4,402
6,043
24,780
32,245
New Jersey
6,115
9,891
1,418
2,280
Pennsylvania
6,125
12,617
10,835
11,901
18,143
20,158
10,670
11,682
Illinois
6,150
8,296
13,970
14,745
Michigan
182,461
226,599
120,648
141,019
Indiana
10,607
8,029
35,999
37,955
Ohio
37,920
34,660
61,812
69,477
59
381
4,776
7,707
256
930
7,676
11,724
US Total
States
Wisconsin
North Carolina
Tennessee
59
Table 22
(continued)
SIC, 3711
Georgia
Missouri
Kansas
Oklahoma
Texas
California
Source:
Note:
SIC 3714
Last
First
Quarter
Quarter
1975
1979
Quarter
1975
Last
Quarter
1979_
7,428
10,985
1,330
3,651
17,586
24,399
6,569
7,535
3,650
5,537
942
1,897
216
4,958
2,296
4,101
5,174
6,640
2,969
3,567
16,363
23,598
9,725
15,152
Fi~rst
U.S. Department of Labor, Bureau of Labor Statistics,
Employment and Wages for SICs 3711 and 3714 By State
for 1975 through 1979, unpublished data. Data for 1979
are preliminary and subject to revision.
Data for a number of states included in the analysis of
the regional distribution of employment were suppressed
by the BLS to avoid revealing the identity of individual
employers. In most instances, with the exception of
Maryland and Delaware, this suppression was probably
not significant.
60
Thus, while some of the regional shifts noted here
recovery from a period of layoffs,
may be the resultof
a
number were probably the result of the relocation of new
plants in the Sunbelt states.
Given the location of plants
opened after 1979 and announcements of plant consolidations
and relocations, I would expect movement to the Sunbelt states
to continue.
b. Locational Changes in the Parts Industry
(SIC 3714)
Although the decline in the share of jobs in the parts
industry in the Great Lakes states was less than in the auto
industry
(this may not prove to be the case for the later
downturn once 1980 figures become available),
the areas of
growth are largely concentrated in the Southeast and Far West
This shift of employment in the parts industry
(see Table 22).
to the Southeast is especially interesting because it occurred
at a time when U.S. automakers were moving new plants to the
Southeast and when foreign automakers were contemplating
investments in the Sunbelt.
Indeed, the subsequent decision
by Toyota to build a plant in Tennessee may have been influenced
by this movement.
According to Table 22, North Carolina, Tennessee and
Georgia accounted for much of the growth of jobs in the parts
industry in the Southeast between 1975 and 1979.
Other states
showed a rapid growth of employment subsequent to the stagnation
of early 1975.
Employment in New York grew by nearly one-third
61
and jobs in Michigan, Ohio and California increased.
(Again,
it should be noted that his analysis does not cover the
subsequent decline of the industry in 1980.
There are some
indications from the county-based analysis that follows that
parts producers in a number of these places were quite
vulnerable to the 1980 decline).
Thus, the shift of employment to the Southeast is far
more apparent for the parts industry
itself.
than
for the auto industry
This movement may have already influenced the locational
decisions made by automakers and will most likely be considered
in
future locational choices.
62
2.
Urban Employment Changes
a.
Recent Employment Changes in Older Industrial Cities
As indicated in Table 21, auto industry employment
accounts for a substantial share of manufacturing jobs
in a number of cities of the Great Lakes States.
23 provides an anaTysis
at
Table
the county level of employment
changes during the most recent period of massive layoffs.
Most of these counties include older industrial cities.
Thus, this analysis supplies a good approximation of
the impact of the recent employment change on central
cities.*
The data in Table 23 include employment statistics for both large and medium-sized cities.
show that
while some of the cities
tan areas in
among the metropoli-
Table 21 had substantial
a number of smaller cities
They
losses of jobs,
(Fort Wayne :in Allen Co.,
Indiana, Columbus, Ohio in Franklin Co.,
Lorain and Elyria in Lorain Co.,
Ohio and
Ohio) lost between
half and twc-thirds of their jobs in the motor vehicle
industry.
Many of the most sevenely affected cities
were in Indiana and Ohio, where declines in employment
at parts producers, rather than at auto assemblers,
analysis
*Since the BLS data used for this
does not include data for the counties surrounding
central cities, it is impossible to extend this analysis
to metropolitan areas.
Table
23
Motor Vehicle Industry (SIC 371) Employment in Selected Counties:
Recent Employment Declines
Peak Employment
County
Trough
of Employment
Percent Change
37.2%
Los Angeles, Ca.
28,789 (1Q79)
18,089 (2Q80)
Fulton Co.,
10,374 (4Q77)
8,162 (3Q79)
21.3%
12,293 (3Q78)
10,155 (3Q79)
17.4%
14, 569 (207 9)
4,996 (1Q80)
18,447(1Q79)
12,013 (1Q80)
34.9%
68,748 (4Q77)
39,786 (2Q80)
42.1%
181,933 (4Q78)
124,356 (2Q80)
31.6%
St. Louis Co., Mo.
17,087 (3Q77)
11,223 (2Q80)
34.3%
Cuyahoga Co., Ohio (Cleveland)
25,687 (4Q78)
14,741 (2Q80)
42. 6%
Franklin Co., Ohio
13, 011 (4Q78)
6,165 (2Q80)
Cook Co.,
Allen Co. ,
Marion Co.,
Ga.*
Ill.
(Chicago)
Ind.
Ind.
Genesee Co., Mich.
Wayne Co., Mich.
(Detroit)
*Data are not available for 1980.
65.7%
52.6%
M'
Table
23
(continued)
Percent Change
Peak Employment
Trough of Employment
13,526 (4Q77)
5,388 (2Q80)
60.2%
Lucas Co., Ohio
14,753 (179)
8,649 (2Q80)
41.4%
Kenosha Co., Wisc.
10,972 (4Q79)
7,766 (2Q80)
29.2%
Milwuakee Co., Wisc.
12,303 (2Q76)
6,650 (2Q80)
45.9%
Lorain Co.,
Source:
Ohio
U.S. Department of Labor, Bureau of Labor Statistics, Employment and Wages for
Standard Industrial Classification (SIC) code 371 By County for 1975 through
the Second Quarter of 1980, unpublished data. Data for 1979 and 1980 are
preliminary and subject to revision.
65
were probably responsible for most of the job losses.
(Note the predominance of jobs in
states in
SIC 3714 in
these
Table 22.)
While the shift of facilities
to the South
noted in the discussion of the regional relocation of
auto j-obs above suggests that auto makers are moving
to low wage, less-unionized areas, the decline of jobs
in some cities does not seem to correlate well with a
presence of low wages.
Motor vehicle employment in
St. Louis and Los Angeles, two cities where wages in
the motor vehicle industry are lower than in other
metropolitan areas that are centers of auto production
(see Table 24) has been far more vulnerable to recent
layoffs than have jobs in Chicago
(although Atlanta,
a city where motor vehicle industry wages are most
probably rather low was less affected by the recent
decline in
jobs).
This suggests that auto industry employment
may be shifting away from more traditional or, possibly,
more militant, centers of union activity.
Certainly
the pressure is on automakers--given the greater concentration of production in a few plants, the more
rapid line speeds they hope to maintain, and the
"Japanese fits and finishes" they must match--to
assure that production faces fewer risks of being
66
Table 24
Differences in Annual Average Hourly Wages in the
Motor Vehicle and Equipment Industry (SIC 371)
By Metropolitan Area
1972
1977
1980
Los Angeles-Long Beach
$4.74
$6.99
$8.07
San Francisco-Oakland
$5.32
$8.45
$10.58
Chicago SMSA
$4.79
$8.24
$10.05
By Metropolitan Area
$9.981
Detroit
Kansas City
$5.40
$8.26
$11.06
St. Louis
$5.13
$7.68
$9.47
Cincinnati
$5.55
$8.57
$10.80
Cleveland
$5.50
$8.72
$10.98
Toledo
$5.34
$8.04
$10.51
1 Data
for 1979 Earlier Years not comparable.
Source:
U.S. Department of Labor, Bureau of Labor
Statistics, Labstat Series Report, unpublished.
67
It should be possible to assess whether
disrupted.
the automakers are responding to union militancy by
examining patterns of work stoppages
at plants that
are being replaced by others or being shut down.
Cer-
tainly many recent plant closing have involved facilities
located in older, urban centers, including a number with
histories of labor unrest, such as Chrysler's Mack Ave.
Stamping plant in Detroit and the Ford Mahwah plant
that drew considerable number of black employees from
New York, Jersey City and Newark (see Table 25).
b.
The Move to "Greenfield" Plants
Recent relocations of plants by automakers
appear to have been influenced in a significant manner
by concerns over problems with traditional industrial
workforces.
This seems to be corroborated by the Big
Three's move to set up "greenfield" plants in
with little history of industrialization.
the steps
places
Certainly
taken by GM and other automakers in
St. Louis
would reinforce this impression.
As documented by MacLennan and O'Donnell, St.
Louis will lose between 11,000 to 13,000 auto workers
by 1982,
with a large part of these job losses due to
the relocation of plants to "greenfield" centers.
By
mid-1982, all GM facilities in the city of St. Louis
will be closed, ending jobs in a 60-year old plant
68
Table 25
Recent Plant Closings
Chrysler Plants
Job Loss
700
Lyons Trim, MI
5,600
Hamtramck Assembly, MI
Fostoria Iron Foundry, OH
650
Eight Mile/Outer Drive Stamping, Detroit, MI
2,400
Windsor Engine, ONT
2,400
Missouri Truck Assembly, St. Louis, MO
4,100
Warren R.V.
Assembly,
MI
Huber Av. Foundry, Detroit, MI
2,000
2,400
500
Cape Canaveral, FL
Mack Av. Stamping, Detroit, MI
Employment Loss from Peak
4,100
24,850
Ford Plants
Los Angeles Assembly,
CA
2,300
Mahwah Assembly, NJ
4,800
Dearborn, Foundry, MI
1,100
Windsor Foundry,
Flat Rock Foundry, MI
future closing)
Cleveland Engine,
1,600
ONT
OH
(announced possible
(indefinite)
Employment Loss from Peak
2,300
9,800
69
Table 25
(continued)
GM Plants
New Locations
Shutdowns
Pontiac Assembly, MI
Orion Township,
St. Louis Assembly, MO
St. Charles, MO
St.
Louis Corvette,
MO
Detroit Cadillac Engine, MI
Flint
Foundry,
Kansas City
MI
(possible)
Detroit Cadillac Assembly
MI
Bowling Green, KY
Livonia,
MI
(Consolidation)
Kansas City Area
Detroit
(negotiation)
Dayton, OH (mini-truck
and engine)
Source:
John O'Donnell and George Byron, Transportation
Systems Center, December 1, 1980.
70
that at its peak in 1978 employed as many as 10,000
workers.
GM will relocate its Corvette operations to
Bowling Green, Kentucky (too far away for workers to
commute to) and to a highly-automated plant in Wentzville,
Missouri, 35 miles from St. Louis.
Chrysler and Ford
already rely primarily on rural workforces in the St.
Louis area.
The two Chrysler plants at Fenton,
Missouri
are 18 miles from the city and the main Ford plant at
Hazlewood is also outside the city
(the Ford plant
produces full-sized Mercury cars that have not been
selling well and its future is uncertain).18
The move to "greenfield" plants provides automakers with access to workforces that are known for
their "work ethic."
A New York Times article noted
that a Detroit auto industry executive explained that
Volkswagen's selection of New Stanton, Pennsylvania
had much in common with Chrysler's choice of Bellville,
Illinois for its new plant.
Both areas have predomi-
nantly white populations made up large-ly of descendants
of Eastern European immigrants.19
in California,
Japanese investors
a number of which are automakers,
have
1 8 MacLennan
and O'Donnell, "The Effects of the
Automative Transition on Employment," pp. 1-4-14 to
1-4-16.
1 9 John
Vinocur, "The Americanization of VW,"
New York Times, October 9, 1977, p. D5.
71
often selected cities with substantial numbers of
Japanese Americans because of their belief that such
workers, although a distinct minority in the workforce,
will help maintain the quality of work. 2 0
Thus, the move to "greenfield" plants seems to
be related to the new demands for more efficient and
profitable production.
Automakers appear to have
concluded that relocating a number of facilities for
downsized cars to areas without a history of industrialization that have ethnic populations with a strong "work
ethic" provides them with a better chance to meet competition than remaining in older, industrial cities
that often have high numbers of black workers
(as is
true of St. Louis, where about one-third of GM's workers
were blacks).
Some historians, however, would argue that
such a strategy is not well conceived, particularly
during a major period of social and economic change.
Leopold Haimson, a historian at Columbia University,
has argued that perhaps the most militant workers involved in
the Russian Revolution were from plants es-
tablished in non-industrial areas during the two decades
2 0 Robert
Lindsay, "Japanese Beachhead in
California," New York Times, August 21, 1977, p. F4.
72
prior to the revolution.21
Many of these workers had
backgrounds that were similar in many ways to those of
the "work ethic" groups being sought in
"greenfield" plants.
the move to
In addition to Haimson, a number
of political scientists, anthropologists and sociologists
have also raised questions about the assumption that
groups without an industrial history will prove to be
better workers,
even if
they are placed in
situations
that hope to improve the quality of their work life. 2 2
C.
Employment Changes at the Plant Level
Prior to contract negotiations that take place
every three years, the major automakers carry out a
survey of employees at each of their facilities.
Al-
though the last survey of this type was performed in
2 1 Leopold
Haimson, "The Problem of Social
Stability in Urban Russia, 1905-1917 (Part I) ,"
Slavic Review, vol. 23, no. 4, December 1964, pp.
619-642 and "The Problem of Social Stability in
Urban Russia, 1905-1917 (Part II)," Slavic Review,
vol. 24, no. 1, March 1965, pp. 1-22.
2 2 See
Paul Blumberg, Industrial Democracy:
The Sociology of Participation (New York: Schocken
Books, 1968) on the Hawthorne experience; Stanley
Aronowitz, False Promises (New York: Basic Books, 197 )
on workers' reactions at Lordstown. The author would
like to thank Dr. Samuel Friedman of the Vera Institute
of Justice for suggesting this line of argument.
73
the spring-of 1979, it is possible to utilize plantlevel information from this period to examine the
structure of labor forces at plants that have been
selected to produce newer cars and to compare it to
those plants that will continue to produce more traditional cars.
This, of course, assumes that differences
probably existed between the workforces of plants
selected for downsized car production and those not
selected (or slated to be closed) even before the changeover occurred.
But previous parts of this paper do
suggest that differences in labor forces at different
locations are probably considered quite seriously in
plant relocation decisions of the Big Three auto producers.
On the other hand, differences may be due to
variations in reliance on outside contractors.
Thus,
this section will examine whether important differences
did exist between plants chosen to be "retrofitted" to
produce new cars and those that were not.
It will
focus on changes at assembly and metal casting plants
of one of the major automakers.*
in the
raised
in the
survey
*Plant-level datas for 1979 and prior surveys
1970s would be useful in testing the contention
earlier that structural changes have taken place
industry's workforce. However, only the 1979
was available for the present study.
74
1.
Changes at Assembly Plants
In 1979, the most highly redesigned plants
were those producing small cars.
Those producing sub-
compact cars were not altered until the 1980s.
there characteristics that
Are
seem to distinguish these
plants from the others, especially those plants producing more standardized cars?
A number of differences are apparent in Table
26.
All of the small car plants produce more cars per
worker than comparable-sized plants that were selected
to produce subcompacts in the 1980s.
Compared to
similar-sized plants producing standard cars, the small
car plants have less workers with wages above $9.08
per hour (the wage for most entry-level assembly
workers in
1979).
This tendency is
less clear when
small car plants are compared to those slated to produce subcompacts.
As far as skilled workers are concerned, Table
26 shows that the small car plants produced more cars
per skilled workers than those selected to produce subcompacts.
The small car plants also appear to have
relatively more skilled workers earning above $11.00
per hour than do plants in either of the other categories,
although this tendency is not well-defined.
There was
a more definite trend towards less skilled workers per
Table 26
Characteristics of Workforces in Assembly Plants
Producing Different Types of Cars - 1979
Characteristics
A1
B
Standard
Car Plants
Plants Selected to Produce
Subcompact Cars in the 80s
Small Car Plants
C
D
E.
F
G
Total Number of
Workers
+
Car Output Per
Year 1979
+230,000 +230,000 +310,000 +215,000 +330,000 +240,000 +146,000
5,100 +
3,700 +
3,600 +
4,200 +
7,800 +
5,800 +
Percent of Hourly
Workers With
Wage Above $9.08
54%
65%
63%
60%
61%
50%
Total Skilled
Workers
195
238
230
276
514
248
.038
.064
.064
.065
.066
Skilled Workers
Per Production
Worker
.042
3,500 +
64%
H
I
4,400 +
8,500
66%
59%
255
405
.059
.048
Percent of Skilled
Workers With
Maximum Wage Rate
Above $11.00
Cars Produced Per
Skilled Worker
(thousands)
39%
40%
49%
43%
46%
36%
.78
.64
.96
36%
34%
Ca,
1.18
.97
1.34
76
production worker at the small car plants.
Thus, newer plants, as mentioned in part A,
produce more cars per worker with less high-paid workers
and have fewer skilled workers per car produced than
plants producing standard-sized cars, including those
plants that were to be "retrofitted" in the 1980s to
produce subcompacts.
There was also a trend to less
skilled workers per production worker at the small car
plants.
On the other hand, skilled workers appeared to
be more highly paid at the small car plants.
What does this suggest about differences in
the structure of work at newer plants?
There seems to
be a greater tendency to rely on less-skilled workers
that are not as highly paid as in standard plants.
How-
ever, several factors may be responsible for this shift.
Production work may have become more "deskilled" because of the redesigning and standardization of parts
in small cars.
But there may also have been a shifting
of responsibility to lower-skilled production workers
from more highly-skilled ones, in other words a change
in job content.
Part of the change may also reflect the move
to new forms of work organization, particularly to more
"flexible" jobs that require workers to perform a far
wider range of tasks than they had in the past.
Thus,
77
assemblers in newer plants may still be called assemblers but may perform a much broader range of tasks.
On the other hand,
some of the changes in
levels of
skilled workers or difference in the size of output
at plants producing the same product (A and B) may be
explained by the fact that certain plants rely upon
outside contractors or other plants within their company's system to provide them with inputs.
Those plants
that produce less cars per production worker may be
producing a number of these parts themselves.
The question of what factors promote changes
in
the structure of workforces that are producing down-
sized cars needs to be investigated in
If
greater detail.
possible, measures of whether better economies of
scale are achieved in
such plants ought to be included
in the analysis.
2.
Changes at Metal Casting Plants
Changes in the workforces at metal casting
plants appear to be similar to those found in assembly
plants (see Table 27).
In
the "retrofitted" plant
studied here there are fewer high-paid unskilled workers
and fewer skilled workers per production workers than
in the more traditional plants.
But there is also a
higher percentage of highly-paid skilled workers in
78
Table 27
Characteristics of Workforces in
Metal Casting Plants - 1979
"Retrofitted"
Plant
Total Number
of Workers
Percent Hourly
Workers with
Wage Above $9.08
+2300
32%
Standard Plants
A
B
+3400
47%
+1900
42%
Total Skilled
Workers
394
644
525
Skilled Workers
Per Production
Worker
.17
.19
.27
Percent of
Skilled Workers
With Maximum
Wage Rate Above
$11.00
36%
31%
35%
79
the "retrofitted" plant.
These results suggest that many of the same
changes in
plants.
job structure may be occurring in
casting
There is most likely a greater level of output
per production workers at the "retrofitted" plant than
in newer ones.
Thus, there may be a greater reliance on
lower-skilled workers either because automation has reduced the number of skilled jobas required per unit of
output, or because work organization or job content
has changed considerably.
There may also be a chance
that parts that required more skilled workers to produce them are now produced elsewhere.
The presence of more high-paid skilled workers
in the "retrofitted" plant may be due to several factors.
It may indicate that some lower-paid skilled workers
have been eliminated due to automation or other reasons,
that more highly-paid skilled workers are needed to
attend the more complicated machinery, or that changes
have occurred in job content and work organization.
Again, these factors deserve further study.
A plant specific analysis that was organized around
interviews with workers and management might provide
more insight into the factors responsible for change
than the data on occupational structure do.
if
it
In addition,
were possible to trace changes in the workforces
80
at these plants over a longer period of time, this
additional information would permit more extensive
analysis of whether structural changes did occur in
these plants during the 1970s.
3.
Conclusions
These plant-level analyses suggest that as
automakers have moved to concentrate production in
plants with higher capacities and greater efficiencies,
workforces in the newer plants appear to take on rather
different characteristics than those in more standard
ones.
The newer plants have fewer highly-paid, non-
skilled workers and fewer skilled workers per production worker.
In newer assembly plants, there is a much
higher level of output per skilled workers than in more
traditional plants.
It is unclear why these changes have occurred.
Some plausible reasons have been suggested here--changas
in
jobs content,
changes in
produce smaller cars,
skill levels needed to
"deskilling" of the workforce
due to the addition of more automated machinery.
How-
ever, it is difficult to specify which of these reasons
have been most important in causing changes in
auto industry's workforce.
the
81
D.
E.
International Parallels with the Current Changes
in the U.S. Motor Vehicle Industry (to be included
in second draft)
1.
Changes in Production, Plant Capacity and Line
Speed
2.
The Transformation of Work in Foreign Auto
Industries
3.
The International Growth of Auto Production
and Its Impact on Employment in the World's
Motor Vehicle Industry
Policy Implications of Changes in Work in the Auto
Industry
The preceding discussion has the following implications for the policy issues raised earlier (see P.10):
1.
Employment opportunities and the distribution
of jobs in the auto industry appear to have
changed a great deal.
However, few government
policies have been formulated to respond to
these alterations in the labor market or to
restore some degree of certainty and stability
for those seeking jobs.
More serious consideration
needs to be given to these problems, particularly
because they have serious impacts on already
distressed cities.
2.
While it is clear that jobs in the auto industry
will shrink, policymakers have largely left it
up to the private sector to decide upon how to
best restore productivity and achieve employment
stability. This investigation suggests that
significant new skills may be required to produce smaller cars and that productivity goals
may be difficult to achieve given pressures of
In addition, the move to "Greenfield"
line speeds.
plants may not help restore stability to employment
in older, industrial centers.
Policymakers ought
to recognize the conflicts inherent in these
attempts to revitalize the auto industry by the
private sector because they have the potential
for exacerbating a number of existing social
problems among the blue collar workforce.
82
3.
Little is known about how employment has been
impacted by investment and product line
decisions and by problems of access to finance
during the restructuring of the auto industry.
As debt becomes more of a problem for the Big Three,
government may need to consider whether public-sector
financing could have a major impact on preserving jobs,
stabilizing communities and reducing the social costs
of job displacement.
4.
The decline of employment in major auto centers, such
Less well-appreciated
as Detroit and St. Louis is clear.
has been the substantial job losses in the smaller cities
of Indiana, Ohio, Wisconsin and Michigan. While government has often been unwilling to formulate long-term
recovery programs -for specific localities in the past,
the pervasiveness of urban distress caused by job
losses in the auto industry ought to lead it to reconsider its previous position.
5.
This study suggests that many of the more highly-paid
non-skilled workers in the auto industry (and probably
also among its parts suppliers) are likely to lose
their jobs as firms move to producing downsized cars.
While these workers have considerable skills gained
by training within firms, they are often skills not
recognized or accredited in any formal way in job
markets. By enabling such workers to transfer these
skills to other jobs or to gain the formal recognition
of these skills that will open up new job opportunities,
government could help reduce unemployment and stimulate
job mobility.
6.
Inadequate attention has been paid to the fact that the
reorganization of the auto industry will provide benefits
Unless some
for some regions and liabilities for others.
policies are developed to offset the more deleterious
consequences of the latter, they may result in a serious
drain on national income and exacerbate employment problems
in distressed areas.
7.
Employment in the U.S. auto industry now seems to be
affected by a period of structural change rather than
a cyclical downturn. Thus, new policies need to be
developed to address the fact that employment changes
will be much more long-term and are more likely to
occur in labor markets that provide more limited
access to jobs.
83
F.
Conclusions
1.
Trends in the Reorganization of Work
The response by the automakers to the crisis in the
industry in the 1970's appears to have resulted in
In
a number of important consequences for workers.
newer factories built to produce downsized cars workers
are expected to work at higher lined speeds and perform'
with a level of efficiency that will help U.S. automakers compete with foreign car producers in the domestic
market.
At the same time, the labor force at the typical new
auto plant differs from its predecessors in a number
It has less high-paid unskilled
of important ways.
workers, fewer skilled workers per car produced and a
tendency to more high-paid skilled workers. There is
also a strong tendency to have less skilled workers at
casting plants, a trend that may also be true in other
parts plants in the industry. On a more general level,
there is a clear indication that the Big Three automakers are relying more upon "Greenfield" plants for
future production facilities than they have in the past.
This suggests that there is a certain unwillingness on
the part of major automakers to remain in older, urban
industrial centers.
Whether th.is is related to worker
militancy, problems in maintaining production quality
or other factors remains unclear.
Besides these trends in the recent structure of plant
employment, the workforce in the industry as a whole
appears to be characterized by a greater number of
professionals and increased importance of operatives
within the blue-collar workforce. While the shift to
professionals is linked to greater need for product
development, corporate planning and management skills,
the cause of the rise of operatives is less clear.
It
does suggest that patterns of job mobility and advancement in the industry may be undergoing a significant
change.
In addition, there are strong trends to foreign sourcing
and even importation of lines of cars from abroad by
U.S. producers that are most likely having an important
impact on domestic employment in the industry.
84
2.
Need for Additional Research
There is a need for further research to help identify
what changes in the industry are having the greatest
impact on the structure of employment.
Additional
work is needed to evaluate a number of the trends described here and to assess the changing skill mix within
the industry..
Whether changes in the industry are driven largely by
automation, by changes in job content, by the redesign
of work or by new subcontracting or sourcing arrangements needs to be clarified. Much of this work will
demand a case-study approach that may be limited by
the access to plants and their workforces.
In addition, the strategies being followed by major
automakers in their investment decisions needs to be
defined in terms of their relationship to employment.
Are these strategies likely to result in more high-paid
skilled jobs and greater numbers of low-paid non-skilled
workers?
Are investments in "retrofitting" old plants
tied to quality of worklife programs?
These questions
need to be examined in more detail than they have been.