I Don't Understand $70+/Hr UAW Wage

fatchowmein

http://www.stltoday.com/blogzone/mound-city-money/us-economy/2008/12/the-70-an-hour-question-what-does-a-uaw-worker-cost/

If the workers are making $70/hr (70*2048=$143,360), wouldn't Detroit be a boomtown with all that money to spend in the local economy? My wife and I combine don't make that amount. Even at $39.68hr, that's $81,264 a year.

The median income in Michigan for a family of four in 2005 is $71,542. http://www.census.gov/hhes/www/income/4person.html

Why this? http://www.nytimes.com/2008/12/13/us/13detroit.html


I'm not trying to be political. The numbers don't add up and I'm trying to understand.

obieone

LOL! I remember when I worked in Bahston, I'd see vehicles with "Vote Union" bumper stickers, and they were ALWAYS POS vehicles! I can only surmise they're not too good with $$$.:rolleyes:

wizzy

Because it is a lie. That number is a conglomaration of may costs, including adding in retiree benefits, etc.

http://mediamatters.org/items/200812060002

In reality, it has been shown that non-union workers in the US working for Toyota, Honda, etc. actually make slightly *more* than the unionized workers of the big three.

This number is repeated over & over by the anti-unions, hardcore right wing press.

ND13

I live in a UAW town, and NOONE I know makes more than $32/hr and they are skilled trades. People want to add in benefits to the $/hr rate to justify their hate for the unions.

BTW, I'm not a union fan by any means. The upper echelon of Union officials is where all the corruption is and the car company officials are in bed with them.

NJPOLKER

I have never seen "hardcore right wing press" only heard a few on the radio.

NJPOLKER

ND13 wrote: »

I live in a UAW town, and NOONE I know makes more than $32/hr and they are skilled trades. People want to add in benefits to the $/hr rate to justify their hate for the unions.

BTW, I'm not a union fan by any means. The upper echelon of Union officials is where all the corruption is and the car company officials are in bed with them.

ND Is there a way to clean them all out?

ND13

Yeah...just noone has the nads to vote them out of their seats. I could care less if the UAW survives or not, I just don't want to see the Big Three go under. I know that it will trickle down to most every household, in a negative way, if they do. Just some faster than others. Unless you're independently wealthy and are liquid, you will be affected.

treitz3

I have a question that maybe one or more of you could elaborate on. How much of the [whatever gross take home] compensation the union employees, do they have to pay for union dues?

How much would that equate hourly [on average] per worker?

In other words, what's the unions take out of all this?

obieone

nevermind. I'll have to find it on my laptop

George Grand

There is something fundamentally wrong when you are paying people $32 hourly to build a car that you intend to sell to somebody that earns $10-$20 hourly.

MacLeod

That $70 an hour is including all the benefits. You have to think, when a company hires you, they may pay you only $10 an hour in cash but they may also pay quite a bit in insurance and all that and that is included in your pay.

I think by the hour the UAW plants are making just a dollar or more an hour than the non UAW plants like Honda and Nissan. The difference is in the UAW plants are getting many more benefits.

Now Im all for anybody earning as much money as they can and if you can get $500/hr then good for you but if your industry just wont support that wage, you have to give in. I generally support the unions. I think theyre the best way to go. No government bureaucracy or red tape, just the workers using their collective bargaining to work with the employers to reach an agreement that is best for both parties. However, as with anything that has people in it - you get the **** that are drunk with power - on both sides - and you have the unions stubbornly pricing themselves right out of a job. It happened in the trucking industry and its happening in the airlines and it looks like its going to happen in the auto industry.

I never have understood the mentality of the unions in situations like this. "We're not going to take a cut in pay - we'd rather have the plant shut down and not have a job at all." Huh??

WilliamM2

George Grand wrote: »

There is something fundamentally wrong when you are paying people $32 hourly to build a car that you intend to sell to somebody that earns $10-$20 hourly.

People earning $10 an hour should not be buying new cars.

sucks2beme

The line workers don't make that much. But they do pretty well.
The average is $28( skilled and unskilled) from the sites I've seen.
So the guy bolting on fenders is still doing pretty damn good.
The figures floating around a ****. They are taking burden rates,
partial budren rates, etc. and going nuts. There are only two
real figures that count. Hourly pay and burden rate. More to the
point is burden, since that's all costs included. That's pay, vacation,
training , sick days, health care costs, and benifits. The burden rate
for everyone on Club Polk is a lot higher than most would expect.
Do you know YOUR burden rate? When I worked project management,
that was a figure we knew by heart, along with target margins.
The union burden rate is higher than non-union. I've seen quotes as high
as 50% more, but who knows what's right. The internet is wrong just as
often as it's right. Either way, it needs to go down. That's hourly wage,
trim benifits, and reduce costs. Sick time is a major issue. Detroit sports
numbers that go way high. That and government jobs. My employers
would of flipped out over anything like that. My first real employer treated
sick days like stealing from the company. And it was a fortune 500 company.
If you could walk without puking, you showed up for work.

steveinaz

Agree, the so-called "$70" an hour wage is a convenient "spin" to make the union guys look the bad guys---again. It's BS. That's all benefits included in that hourly wage. Love to hear what those engineers and execs make per hour with benefits.

The reason the auto industry is suffering is three-fold:
1. The current economy is sucking right now
2. Too many models, most are unappealing to US consumers
3. US cars (especially trucks) are way over priced. (of course that's those damn union guys fault again--****)

George Grand

WilliamM2 wrote: »

People earning $10 an hour should not be buying new cars.

They shouldn't be handed mortgages either but HTF we are, aren't we?

treitz3

Steve, there's also a frozen credit market. It's thawing but that's hurting them as well. It has been said on the news that creditors are only accepting scores of 725-750 and that the interest rates for such good credit fall between 14-15%. Take that with a grain of salt though because half the "facts" out there are skewed or false to begin with. I do know that the credit markets do and have played a major role in all of this regardless of "the facts".

Also, I stumbled across this to answer my own question as to what is the Union's take throughout all of this..... http://www.uaw.org/solidarity/08/newmbr/newmbr13.php

McLoki

steveinaz wrote: »

The reason the auto industry is suffering is three-fold:
1. The current economy is sucking right now
2. Too many models, most are unappealing to US consumers
3. US cars (especially trucks) are way over priced.

So without taking the thread totally off course and in all seriousness - how will the "bailout" that the big 3 are asking for help? (they will just have more cars on lots that people won't buy)

From what you are saying to make the "bailout" effective the Govt. would need to allow a 25%-50% tax credit for people who purchase a new car from a domestic automaker. This would allow people with lower incomes to purchase a new car, get people to purchase a car they are not thrilled with (but can tolerate) because it is cheap and take care of the price issue.

I knew I should have run for president.....

One other question - If this is truely a loan that the automakers will use to turn around their business and they will pay back - why don't they go to a bank for it like everyone else? (thought of that one this morning) If the answer is because no bank would believe their turnaround would work - maybe our Govt. shouldn't either.

Michael

sucks2beme

I just went down to read the paper. There it is on the front page.
http://www.dallasnews.com/sharedcontent/dws/dn/latestnews/stories/121308dnbusautopay.3e09ca7.html

MacLeod

The unions and government regulation is what is killing the Big 3 and until those 2 things are fixed, no bailout is going to work. After we give them all this money, theyll still have twice the labor rates as the foreign auto makers - they will still have BILLIONS going out in pensions and they will still be crippled by this IDIOTIC CAFE standards that is forcing them to spend precious resources building cars that nobody wants but they have to build in order to make their fuel efficiency numbers.

danger boy

how many more companies are now going to step up and ask the Gov't for bailout money? Where is the acountability in that? The wrong message is being sent... if your company is struggling to stay afloat, don't worry the Gov't will most likely bail your **** out of huge debts. :eek:

I don't want to see any of the big three auto makers go under either.. and i'm looking at it strictly from a workers point of view. We can't afford to have that many more people on the unemployment line. I think I heard on the newz that close to half a millions people joined the ranks of the unemployed over the past two month's. This is not good.

Personally, I think the big three auto makers should focus on making good vehicles but not so many different ones. Seriously, did we really need a PT Cruiser? C'mon. The world would have gone on just fine without that ugly POS car. Think of the R&D that went into that, the models, the prototypes, then finally building it.. I bet it was million's of dollars wasted on it before it finally was put into production. Waste of $$ if you ask me.

LessisNevermore

MacLeod wrote: »

After we give them all this money, theyll still have twice the labor rates as the foreign auto makers

How did you come to this number?

The $70/hr. figure has already been shown as misleading.
Playing by the same rules then, the Japanese are paying around $50/hr. (with the Japanese gov't. picking up the insurance costs) and lots fewer retirees. The UAW has already agreed to take on the health care costs, and cut their # of employees by 50%. It's probably a safe bet that getting 95% for shutdown pay is probably gone too.

The US and Japnese(owned) companies are paying within a couple dollars/hr. of each other.

I do agree about the CAFE bs.

tommyboy

LessisNevermore wrote: »

How did you come to this number?

The $70/hr. figure has already been shown as misleading.
Playing by the same rules then, the Japanese are paying around $50/hr. (with the Japanese gov't. picking up the insurance costs) and lots fewer retirees. The UAW has already agreed to take on the health care costs, and cut their # of employees by 50%. It's probably a safe bet that getting 95% for shutdown pay is probably gone too.

The US and Japnese(owned) companies are paying within a couple dollars/hr. of each other.

I do agree about the CAFE bs.

Yes, but the difference is that japanese cars are actually selling. Its all about how your business is doing. Do you think football players deserve to make millions per year. Of course not, but the business makes a **** load of money and their players get a huge paycheck cause of that popularity.

MacLeod

LessisNevermore wrote: »

How did you come to this number?

Im talking about the TOTAL labor rate including health insurance, pensions and so on. Thats $70/hr for the UAW guys and Ive seen everything from $45-60 for the foreign autoworkers when considering total benefits.

disneyjoe7

tommyboy wrote: »

Yes, but the difference is that japanese cars are actually selling. Its all about how your business is doing. Do you think football players deserve to make millions per year. Of course not, but the business makes a **** load of money and their players get a huge paycheck cause of that popularity.

Actually when business was good they could afford the labor rate + bens rate... Now since they have had their heads up their a$$ and they are not selling the old business model is NFG. I can't see the US Government giving them $$$ as is, but the last thing the Bush administration wants is the failure of the big 3 on its way out.

LessisNevermore

tommyboy wrote: »

Yes, but the difference is that japanese cars are actually selling. Its all about how your business is doing. Do you think football players deserve to make millions per year. Of course not, but the business makes a **** load of money and their players get a huge paycheck cause of that popularity.

Then you haven't been paying attention. The Japanese big three sales are down almost 40%, as well. Let me ask you this then, Do you have a problem with CEO compensation? Yes they have a lot of responsibility, but do their day-to-day duties really justify upwards of 350 times that of their employee's pay?
What about bonuses, when their companies are in the crapper? Is that ok too, just because their company rakes it in hand over fist?

I see a lot of animosity towards high paying jobs that don't require a degree. Then again, people seem to think that $25/hr. is a lot of money. When we're all fighting for a job at Walmart, I guess it will be.

Erik Tracy

tommyboy wrote: »

Yes, but the difference is that japanese cars are actually selling. Its all about how your business is doing. Do you think football players deserve to make millions per year. Of course not, but the business makes a **** load of money and their players get a huge paycheck cause of that popularity.

Yup.

The New York Times did a story on this.

The $70/hr wage was decomposed and analized as:
Base salary of an average of $40/hr + annualized benefits of $15/hr - then the remainder was a 'factor' for what the auto companies have to account for to make up for the pensions of retired auto workers. All that adds up to $75/hr.

But the 'base pay' was compared and found to be comparable to the wage paid to US workers for US based Japanese factories.

The article also calculated that even if UAW were to make salary concessions that the resultant reduction in the price per car would only be about $800.

That certainly is not enough to induce consumers to change their choices.

The bottom line was that most consumers don't want the cars made by American companies - they just....don't....get...it. And what they do make is of inferior quality.

Make a car consumers want to buy and they will buy it.

tommyboy

LessisNevermore wrote: »

Then you haven't been paying attention. The Japanese big three sales are down almost 40%, as well. Let me ask you this then, Do you have a problem with CEO compensation? Yes they have a lot of responsibility, but do their day-to-day duties really justify upwards of 350 times that of their employee's pay?
What about bonuses, when their companies are in the crapper? Is that ok too, just because their company rakes it in hand over fist?

I see a lot of animosity towards high paying jobs that don't require a degree. Then again, people seem to think that $25/hr. is a lot of money. When we're all fighting for a job at Walmart, I guess it will be.

The japanese sales drop is a direct effect of the bad economy, not because of bad business. I never said the big 3 are doing bad just because of the UAW. The biggest reasons for the big 3 downfall is ridiculous employee(and higher management) wages, and more importantly, the bad perception of american cars. If the american cars sold, we wouldn't be bitching about how much money anyone makes. Its just that now they are asking us to pay for them when they aren't "doing their job"(more of the upper managements problem).

treitz3

Erik Tracy wrote: »

Make a car consumers want to buy and they will buy it.

All due respect Erik but I drive a Chevy truck and I prefer to drive nothing else. All my life I have had American cars and either I have been extremely lucky or all of them have been extremely reliable and great cars to own/drive.

It drives me bonkers when "all" American cars are lumped into one category. I have pride in what America has to offer. They have done me nothing but justice. I'd also like to add that I purchased my 2004 2500HD Silverado LB 2x2 brand spankin' new for $18,400 out the door. Taxes, title, fees and all. That's NOT a bad price at all. That said, 108,000 miles later all I have had to do is rotate tires, change the oil, replace three light bulbs and keep her clean. Not bad for an American vehicle that hauls close to 10,000 lbs on a daily basis.

As an American, I feel I owe it to America to keep my money in this country. I have NO shame in that and in return, I have gotten nothing but great vehicles in return. [My favorite was a 1979 Tran's Am ]

treitz3

Oh, my bad. I had the fluids changed in the tranny as well. Sorry.

disneyjoe7

I slept in a Holiday Express last night.

Ricardo

I had chinese food for lunch.