I just want to blow a hole in this idiotic myth that auto workers are making scads of money

[ThomWV]

This is hypocrisy at its best.

When you see it said anywhere that auto workers make more money than god I want you to understand that the rates cited are fully loaded.

So what you are seeing is not the honest hourly pay that when multiplied by hours worked gives the employee's gross pay. What you are seeing is that honest number plus the various overhead costs that go with it. Among those costs are the employer's contribution to Social Security, a bit over 7% of the base rate. You are also seeing the overhead cost of keeping that employee, which includes such mundane expenses as keeping the lights on at the factory as well as its heating, cooling, water, sewage, day to day common use materials, and a million other small expenses all allocated on an hourly basis to each individual employee. However there is another cost included in there that is even more of a slap in the face to reality.

That cost you see cited also includes General and Administrative expenses allocated to employees on an hourly basis to come up with the misleading number and part of this pool of cost is the cost of the company's management. That's right, they are including the cost of the CEO, the President of the company, in computing the average worker's pay. Let me say that again, the pay of the entire management structure of the company, the President of General Motors as an example, and every one of his staff and every single head of every Division, and every Vice President, and all of their staffs, and the price of running the corporate jet too, all of that is allocated and divided between the hours worked by the guys and gals on the line to come up with that awfully misleading number.

Just thought you should know.

[LaurenG]

1. Funny how you got all these recs and no kick

so kick!

[BobRossi]

2. They also spread the wealth.

They buy what they make, they send much of what they earn straight back to the economy.

[Occam Bandage]

3. Cut up the pie however you like. Doesn't change its size.

It doesn't particularly matter whether all that money is going to workers, or is going to programs for workers, or is being thrown into furnaces in front of workers. What matters at the moment is that Detroit's labor costs are so high that it cannot price its cars competitively without losing money on each car. A bailout will be a waste of money unless Detroit can either figure out how to significantly lower its labor costs, or raise its income to cover those costs.

[BobRossi]

6. Cut top management pay.

Why shouldn't the people that make the product be able to afford the product?

[Occam Bandage]

7. Which accounts for how much per car? nt

[ThomWV]

8. You seem to miss the point that the pay of the boss is being included with the pay of the worker

Get it? The pay of the boss is being called part of the hourly rate of the worker in an attempt to demonstrate that the worker is overpaid. Did it ever occur to you that it might be the boss that is overpaid and not the worker?

[Occam Bandage]

10. Do you really believe that lowering executive salaries will save Detroit $2000 per car made?

Like I said: you can argue all you like about how much of that $75 per hour or whatever goes to workers and how much doesn't. It doesn't matter. What matters to the taxpayer is whether Detroit can lower its production costs enough to be competitive.

[ThomWV]

11. No, but single-payer national health care would lower it that much

[Occam Bandage]

13. Almost, yes. That would be a good way of lowering manufacturing labor costs.

It's strange that America would saddle its most vital industries with the burden of providing healthcare, while foreign competition does not have any such burden.

[AngryAmish]

26. Cars would be cheaper, everything else is more expensive

I support single payer - but it is not cost free.

Americans expect a certain level of care. Even if you are a Medicaid recipient you can get a kidney transplant. So if there is a single payer I assume the overall level of care will be at least the same.

Where do you save money on health care? I assume the savings will be from cutting out the insurance companies. Then those folks are out of a job. Which is fine.

Anyway the point I am making so poorly is health care is not free. If there is single payer then taxes have to be raised. Which means less money for other things for everyone.

[LaurenG]

14. I don't know, maybe the top CEO's could sell a couple of Jets, three or four houses

and reduce their own wages, it'd be a great start.

edit - left out a word

[guitar man]

18. so what's the answer?

lowering wages to mere scratch-it-out subsistence levels? Stripping retiree benefits? There's nothing progressive about that.

[Occam Bandage]

20. If I knew how to turn around Detroit,

I would be making hundreds of millions of dollars doing so right now.

[guitar man]

22. apparently one doesn't need

...to know anything to make hundreds of millions of dollars, the cats at the top keep getting compensation like that for failing. How anyone can point the finger of blame at the line workers and accuse them of being greedy and making too much is beyond me. :(

[RaleighNCDUer]

23. Actually, you wouldn't.

They'd be paying you top dollar to NOT do it, so as to maintain their looting of the companies. Which, of course, would make you part of the problem.

[Occam Bandage]

24. Either way, I'd be making a lot more than I am as a research assistant...

:P

[bluecollarcharlie]

29. Why don't you just come right out and admit the truth.

You're one of those so called progressives that think that if the collar is blue the guy shouldn't make a good middle-class wage. He just gave you a rare thing on this site: a good cogent explainer on some of the junk you've been hearing over the last 5 days. And you shot it down, seemingly without reading the damn thing! I am an autoworker, and proud of it. We helped to build and defend this nation and increase it's standard of living over the years in ways that no one else have. I know i do a damn good job and i'm proud of it.
What do you do for a living, if i may ask? Do you work with your hands? Do you move/stand/bend/lift parts 8 hours a day? Go home with sore hands and back and feet and repetitive strain injuries? Do you even know of anyone that does real, hard work? Do you even work?

You probably the type that sneer at us while drinking your chai latte thinking that you're better than all the "working-class trash."

But you'll tolerate us come election time. I work damn hard for my money. I don't apologize for making what i earn because i earn it.
This isn't like all of those bankers on Wall Street who sit on their asses all day manipulating numbers and ruining peoples lives and then go have lunch for an hour getting drunk at Scores strip club and then go back and do it again til they go home. I do real tangible work. And am proud to support anyone that does.
What i am not however is a pretend liberal.
There seems to be a lot of that going on around here.

[Occam Bandage]

44. Because that isn't the truth at all.

Stereotype more, though.

[sendero]

49. Autoworkers..

... UAW autoworkers might not have been making too much in the past, but they are now. Of course, so is management.

They have a choice, lower compensation, or no job. It's really that simple and no amount of not liking it will change it.

As a computer geek, I made great money before 2000. I make less great money now. My choice was to either accept the market rate for my services or seek another career.

[Two Americas]

40. the reason we are at a disdavantage

Companies and countries that take care of their people will always be at a "competitive disadvantage" with those companies and countries that do not. The ultimate extension of you logic is a race to the bottom, a devaluing of the people.

You are promoting the very core and foundational concepts of the political right wing. You are free to do that, of course, but don't surprised of you run into some opposition here.

In what sort of political context are the "taxpayers" needs and interests at odds with the workers needs and interests? Reaganomics, that is what sort of context.

[walldude]

55. One 21 million dollar bonus would save $2000 on 10,500 cars.

So yeah I think cutting CEO bonuses might help just a little.

[bertman]

28. Thom, I think you are wrong about that. Granted, I'm only a small business owner not an

accountant, but assuming you are referring to the $73/hour; there is no way in hell that contains all of those overhead costs, including management salaries and company overhead. If that were factored in it would probably be around $730/hour.

Our little company, which pays an average wage of around $24/hour, if we included all of the overhead costs you attribute to the GM worker's wage would be somewhere above $200/hour.

I think it's fair to say that the $73/hour figure comes from including all health benefits, retirement benefits, vacation benefits, holiday pay, SS tax, petty leave, sick pay, etc. I'm basing that on someone making around $33/hour average wage, which would include overtime pay.

I would love for someone to give us a breakdown of how that $73/hour figure was arrived at.

[guitar man]

9. labor costs account for

about 8.5% of the cost of each car. I wonder what all that top heavy management accounts for?

[ThomWV]

12. Want an educated guess

Probably something on the order of 25~30%.

I spent decades looking at the books of litterly thousands of companies and that is about what it averages out to.

[guitar man]

16. I thought so

And this is for the people in the company that don't produce a damn thing. Parasites. :grr:

[Occam Bandage]

17. Not all management is parasitical.

If you're going to be scrupulous about excluding board members from labor costs, it might be beneficial to also separate them from management costs.

[guitar man]

19. that's true

there are managers in the basement that actually do something. I should have said "upper management".

[Bentcorner]

25. Is that true for every car built or is it an average across every line?

[Two Americas]

39. false

Everyone else's wages have fallen.

Lowering labor "costs" is the job of management and the political right wing. It is entirely inconsistent with the traditional principles and ideals of the Democratic party and the Labor movement.

Human beings are not a "cost" nor a commodity on the "free market."

"Detroit" - by that I assume you mean management - knows how to "reduce labor costs" and do not need to figure anything out. The obstacle is the people, the political Left, and the Labor movement.

[HysteryDiagnosis]

4. Auto workers ate my retirement.... n/t

[mrreowwr_kittty]

5. Is there a link anywhere for this?

I would love to have it available to debunk the idiots.

[DBoon]

15. They are making what Americans workers all deserve to make

If you took the typical wages from say 1967, added increases for inflation and overall productivity increases, I bet the average American worker would have a package similar to unionized auto workers.

THEY aren't overpaid - the rest of us are underpaid

[fed_up_mother]

53. "All" American workers do not deserve to make that kind of money

Good grief! Do you know anything about economics?

How much will you pay for a cup of coffee to pay that worker $75,000 a year? Those jobs - gone!
How much will you pay for a meal out? Those jobs - gone!

And on and on.

[RaleighNCDUer]

21. So you are saying that when they say "the average GM salary

is $75/hr" they are figuring the CEO pay into the average?

Are there any clear figures on the average line-worker salaries?

[bluecollarcharlie]

30. I tell you myself. I make 27.50 an hour. Straight time. No overtime. Get your average from that.

[Blue Diadem]

35. Here's a link explaining those figures tossed around:

http://www.uaw.org/barg/07fact/fact02.php

How much are current UAW auto industry wages?

In 2006 a typical UAW-represented assembler at GM earned $27.81 per hour of straight-time labor. A typical UAW-represented skilled-trades worker at GM earned $32.32 per hour of straight-time labor. Between 2003 and 2006, the wages of a typical UAW assembler have grown at about the same rate as wages in the private sector as a whole – roughly 9 percent. Part of that growth is due to cost-of-living adjustments that have helped prevent inflation from eroding the purchasing power of workers’ wages.

Why is the figure cited as hourly labor costs by the companies so much higher than the wage rates?

In addition to regular hourly pay, the labor cost figures cited by the companies include other expenses associated with having a person on payroll. This includes overtime, shift premiums and the costs of negotiated benefits such as holidays, vacations, health care, pensions and education and training. It also includes statutory costs, which employers are required to pay by law, such as federal contributions for Social Security and Medicare, and state payments to workers’ compensation and unemployment insurance funds. The highest figures sometimes cited also include the benefit costs of retirees who are no longer on the payroll.

[RaleighNCDUer]

37. So that's like saying that I, rather than the @$29k gross I make,

actually am a solid middle-class $45k/yr worker, because of the value of my health and dental insurance, the potential to earn time and a half if I work holidays, and the employer contribution to my 401K, SS & medicare.

So I don't REALLY take home $1600/mo to my crappy 1 bdrm apartment for which I pay 1/3 of my take home, and drive a 12 year old vehicle. I'm middle class.

Funny. I still feel poor.

(caveat: I know I am doing much better than many, many others out there, in that I am employed and have insurance. that doesn't change the reality on the ground that I am barely making my bills and not because I have an extravagant lifestyle.)

$30/hr straight time is OK. It is a good, solid income. If wages had kept up with inflation over the past 25 years, it would be slightly above what most of us out here are making. I'm certainly not going to begrudge anyone making $60k/yr when, by the standards of the '50s, I should be making $48k myself.

This is all just an attempt to bust the unions. Nothing more.

[Fire1]

42. For sure. As union workers have been on the decline, real wages

have fallen and people are working longer hours. The gap between the rich and poor has widened dramatically.

[Raschel]

27. I'd like to see wages of our congress with perks and health insurance

added in. Including car rental and the rest.

[bluecollarcharlie]

31. I can't give you the rest......

........but the yearly salary of Nancy Pelosi is $217,400. All the others including Harry Reid makes $188,100. Lifetime health care, retirement pay that can top out at 80% of their last pay, postage and office costs, travel,all of that is not included.

[ThomWV]

47. You are wrong about the benefits they receive

They receive exactly the same benefit package as every other Federal civil servent. They may continue their healt insurance into retirement but they have to pay for it. They certainly do not get 80% of their last pay, not by any stretch of the immagination. Also, just as you would not count the cost of building the factory the auto worker toils in as part of his pay you can not count the value of the capital building and its offices in the pay of our representatives.

[MicaelS]

32. Public perception is very important

Bad public perception leads to resentment and lack of empathy or sympathy by the public. As the big 3 CEOs proved when they flew in on their Corporate jets. The public perception is that they are completely out of touch. Which, IMO, is true. The public perception is the the UAW members are overpaid for the work they do. When the head of the UAW maintains they will be no compromise, and the existence of the Job Bank proves people get paid up to 95% for doing nothing, the public perception is validated in most people's minds and proves to them that the UAW and it's members are also out of touch.

Now, having said all that, IMLHO, if the UAW is not willing to sacrifice right now (I don't care about what they did in the past), then no bailout, loan or whatever you want to call it.

[YvonneCa]

33. Public perception is being used to sway the public...

...to get rid of union jobs. People have a perception that auto workers make a lot of money because of their unions, teachers work part time because of their unions, and that our Congress people only work when you can see them on C-Span. NONE of that is true...it's a perception. But perceptions DO matter....and right now, they are being exploited to get rid of unions, union protections and union jobs. JMHO.

[RaleighNCDUer]

36. This job bank, if I understand it correctly, is intended to keep

auto workers on payroll during down times, as when the facility is re-tooling, and when there are slowdowns in the economy, so that the corporation cannot simply replace laid-off workers during the down times with younger, less experienced and less expensive workers. Before the job bank, once a worker hit a certain level he could expect that at the next cyclical downturn he could lose his job permanently - and that uncertainty was used as a threat by management to hold down payroll. With the job bank, that threat was alleviated because if the company had to pay him anyway, there would be no profit in replacing him with scab, er, less expensive temporary labor.

That is how the UAW has managed to keep a well paid workforce throughout the 90s and 00s while other companies have been slashing full-time rosters and replacing them with P/T and temps.

You have a problem with good paying jobs? You think ALL of the US should be paid like they work at Burger King?

[bluecollarcharlie]

45. Do you know that Honda in Ohio has their version of the job bank?

Based on the same principal of community service work just like ours? Didn't know we did service work?
Oh, I see. You just assumed we gold bricked all the time.

[MicaelS]

51. Honda isn't in financial trouble

And asking for government help. Big difference.

[YvonneCa]

34. Deal. Just so long as I can also blow a hole in this...

...idiotic myth that teachers have too much free time because their union contracts protect them at the expense of children. :7

[bluecollarcharlie]

46. I'll Take you up on that one!

[YvonneCa]

54. Thanks! And welcome to DU. n/t

[noonwitch]

38. My uncle worked at Ford until he got cancer-he made $75000 a year!

And he died in 1998, so that was over 10 years ago. That is good money. He didn't even have a college degree, he worked in the packaging department and before that, in groundskeeping.

75,000 a year for a guy without a college education is good money today. I don't make that and I have a BSW. 75,000 is teacher money.

[Raschel]

41. They're paid for the use of their body. And they pay for it. And your uncle worked

alot of overtime, which would mean working beyond the mandatory ten hour days, and working weekends.

[Fire1]

43. Not in Detroit, it's not and THEY HAVE A UNION!

[SmileyRose]

48. what was his job? - line workers/straight time max at 56K - most much less

and if you keep your eye on the ball - the issue isn't actually that "greedy union slobs" make too much money - it's that most non-union workers, and a good many union workers too, are taking a beating while primary stockholders and upper level management walk away with all the loot.

[NashVegas]

50. They Make a Lot More Than Your Average Hamburger Flipper ...

And even some low-grade professions. They probably make more than your local newspaper reporters, unless you live in a major city. That last part may have some significance.

I've an acquaintance at GM who makes 2x my salary, on the line. I don't begrudge it, I just wonder "where the hell were you when the Ladies Garment Workers were getting decimated?"

Anyway, it's an emotional argument. Talk about union workers all day but we'll still be back here again in March if the Big 3 don't produce a plan to get themselves into the black.

[fed_up_mother]

52. In what businesses are utilities included in labor costs?