a modern parable

A Japanese company ( Toyota ) and an American company (Ford Motors)
decided to have a canoe race on the Missouri River. Both teams
practiced long and hard to reach their peak performance before the
race.

On the big day, the Japanese won by a mile.

The Americans, very discouraged and depressed, decided to investigate
the reason for the crushing defeat. A management team made up of
senior management was formed to investigate and recommend appropriate
action.

Their conclusion was the Japanese had 8 people rowing and 1 person
steering, while the American team had 7 people steering and 2 people
rowing.

Feeling a deeper study was in order; American management hired a
consulting company and paid them a large amount of money for a second
opinion.

They advised, of course, that too many people were steering the boat,
while not enough people were rowing.

Not sure of how to utilize that information, but wanting to prevent
another loss to the Japanese, the rowing team's management structure
was totally reorganized to 4 steering supervisors, 2 area steering
superintendents and 1 assistant superintendent steering manager.

They also implemented a new performance system that would give the 2
people rowing the boat greater incentive to work harder. It was
called the 'Rowing Team Quality First Program,' with meetings, dinners
and free pens for the rowers. There was discussion of getting new
paddles, canoes and other equipment, extra vacation days for practices
and bonuses. The pension program was trimmed to 'equal the
competition' and some of the resultant savings were channeled into
morale boosting programs and teamwork posters.

The next year the Japanese won by two miles.

Humiliated, the American management laid-o ff one rower , halted
development of a new canoe, sold all t! he paddle as, and canceled all
capital investments for new equipment. The money saved was
distributed to the Senior Executives as bonuses.

The next year, try as he might, the lone designated rower was unable
to even finish the race (having no paddles,) so he was laid off for
unacceptable performance, all canoe equipment was sold and the next
year's racing team was out-sourced to India.

Sadly, the End.

Here's something else to think about: Ford has spent the last thirty
years moving all its factories out of the US , claiming they can't
make money paying American wages.

TOYOTA has spent the last thirty years building more than a dozen plants
inside the US The last quarter's results:

TOYOTA makes 4 billion in profits while Ford racked up 9 billion in
losses.

Ford folks are still scratching their heads, and collecting bonuses...
 
Here's something else to think about: Ford has spent the last thirty
years moving all its factories out of the US , claiming they can't
make money paying American wages.

TOYOTA has spent the last thirty years building more than a dozen plants
inside the US The last quarter's results:

TOYOTA makes 4 billion in profits while Ford racked up 9 billion in
losses.

Ford folks are still scratching their heads, and collecting bonuses...

Yes, it's quite amazing.

The average car factory worker in the US would not even earn $10 per hour, and would only get 2 weeks holidays per year, with no sick pay (it comes off the holidays), no leave loading or penalty rates and no compulsory super. People who take (regular) sickies often get sacked, and there is none of our pathetic 3 written warnings plus councelling and retraining - it's on the spot.

Meanwhile, the CEO will earn a minimum of $2 million if he's being stiffed, plus whatever bonuses they can dream up, and a nice golden parachute of a coupla hundred mill.

But hey; they are the smart country, right?
 
Yes, it's quite amazing.

The average car factory worker in the US would not even earn $10 per hour, and would only get 2 weeks holidays per year, with no sick pay (it comes off the holidays), no leave loading or penalty rates and no compulsory super. People who take (regular) sickies often get sacked, and there is none of our pathetic 3 written warnings plus councelling and retraining - it's on the spot.

Meanwhile, the CEO will earn a minimum of $2 million if he's being stiffed, plus whatever bonuses they can dream up, and a nice golden parachute of a coupla hundred mill.

But hey; they are the smart country, right?


Not if they're UAW members.
 
Yes, it's quite amazing.

The average car factory worker in the US would not even earn $10 per hour, and would only get 2 weeks holidays per year, with no sick pay (it comes off the holidays), no leave loading or penalty rates and no compulsory super. People who take (regular) sickies often get sacked, and there is none of our pathetic 3 written warnings plus councelling and retraining - it's on the spot.

There is plenty of info on this on the net, so it is a very simple task to research it. You will find that you are way off. And that's one of the big issues the US car industry is facing. The average worker is getting $28 per hour, which is well above the national average pay. They are getting a company paid retirement pension and are having their health insurance paid for (which as you probably know, is very expensive in the US).

Contrary to what you have said, the US Car worker is very well compensated and represent an average hourly cost to the company of $73. Their union, the UAW, has enormous political power that will probably end up costing their member their jobs.
 
I didn't care about the US either...until the Sub-Prime crisis affected/infected the world. I never TRUELY understood how MUCH their economy could/would affect ours.

Great reading artemis, pretty much sums things up nicely.

Regards Jo
 
Not sure of how to utilize that information, but wanting to prevent
another loss to the Japanese, the rowing team's management structure
was totally reorganized to 4 steering supervisors, 2 area steering
superintendents and 1 assistant superintendent steering manager.

Yeah but how sweet would it be to be a nice cushy area steering superintendent.
 
i read that the union members make around $70 an hour

the US car making industry is a joke

i think that was the average - and included their medical, superannutaion etc. so maybe the multiple bosses on their multimillion dollar wages are pulling the average up.
 
There is plenty of info on this on the net, so it is a very simple task to research it. You will find that you are way off. And that's one of the big issues the US car industry is facing. The average worker is getting $28 per hour, which is well above the national average pay. They are getting a company paid retirement pension and are having their health insurance paid for (which as you probably know, is very expensive in the US).

Contrary to what you have said, the US Car worker is very well compensated and represent an average hourly cost to the company of $73. Their union, the UAW, has enormous political power that will probably end up costing their member their jobs.

Yep, it's a case of the unions thinking they've had a big win over the evil bosses - but kill the golden goose in the process. It'll happen here sure enough.

The exceptional pay is probably true of the professional and skilled workers in the industry - electricians, engineers, accountants etc.

Unskilled labour award in the USA is around $5.75 per hour last time I was there, so I can only guess what they actually earn if it's above this. I was paid $10.33 per hour as a shop assistant in a proshop there, so it would be doubtful that an unskilled factory worker would be on $28. Happy to be proved wrong though.

I knew a store manager of a "chain" clothes shop (Kohl's) who was earning $11 per hour.

The health insurance that the companies pay is not that great; it's usually the minimum cover, which is around 70% of the bill, and the client has to fund the difference. An out-of-pocket gap payment for an op like an appendectomy will cost the client around $5k after insurance has been factored in - based on what my wife informed me from her time at Cedars-Sinai.

And, if you are off sick for too long and the company sacks you (as often happens) the health insurance expires. Nice loophole. The biggest cause of bankruptcies in the US is because of medical bills.
 

Ok, we're getting closer.

Notice that the article refers to average wages.

So, this would include all the workers, the management, the Board of Directors, the CEO, and those other workers not actually working anymore who still receive benefits under the old scheme of defined benefits.

For argument, let's use the CEO wage. Most CEO's are earning around 50,000 times the average annual salary.

And, the average annual salary is a totally inaccurate figure to start with, as it is measured the same way; add up all the wages and divide by the total of workers. Tell that the the chic who used to serve me in the Hollywood Video store earning $15k if lucky.
 
Ok, we're getting closer.

Notice that the article refers to average wages.

So, this would include all the workers, the management, the Board of Directors, the CEO, and those other workers not actually working anymore who still receive benefits under the old scheme of defined benefits.

For argument, let's use the CEO wage. Most CEO's are earning around 50,000 times the average annual salary.

And, the average annual salary is a totally inaccurate figure to start with, as it is measured the same way; add up all the wages and divide by the total of workers. Tell that the the chic who used to serve me in the Hollywood Video store earning $15k if lucky.

No, it actually says "average wages for workers at Chrysler, Ford, and General Motors were just $28 per hour as of 2007. That works out to a little less than $60,000 a year in gross income -- hardly outrageous, particularly when you consider the physical demands of automobile assembly work and the skills most workers must acquire over the course of their careers."

It is quite specific that the discussion is about the assembly workers as that is the massive debate ongoing in the states at the moment. This is the auto workers union defending the notion that they are over paid and using the figure of $28 per hour as proof that they are not overpaid.

And of course an average means that some are earning more and some less. Either way the auto workers in the states are paid substantially more than the "average" US worker. It is in the interest of the Union to downplay the earnings, to further their cause in the current debate. If it were as you are suggesting above, they would make that patently clear and discuss the real situation.

The chick at the video store should get a job welding bits of metal together. She would double her income, have her health insurance paid for, and pick up a pension.
 
I used to live in the US too (like LA.Aussie / BayView) and would be highly surprised if the car workers would make anything like $28. Haven't looked into it and could be wrong.

I had a quick search on Monster.com and the few Automotive Industry Assembly Worker type jobs I found were $13 - $16 per hour.
 
The Japanese won because of all the genetic modified food they have been eating. Also 8 Japanese rowers probably weigh as much as 2 American rowers.

Do not believe the profits that Toyota states.
 
I used to live in the US too (like LA.Aussie / BayView) and would be highly surprised if the car workers would make anything like $28. Haven't looked into it and could be wrong.

I had a quick search on Monster.com and the few Automotive Industry Assembly Worker type jobs I found were $13 - $16 per hour.

Did you read the link. That is the number their own union says. I could have copied links for dozens of pieces on this but chose the UAW as they are the ones with the vested interest to play down talk of their members being over paid. In a nutshell, I think they would know what the average pay of their members is. There is no doubt, ambiguity or skepticism from anyone involved in the debate over there as to what the real number is. It is a simple fact.

Everyone is surprised, that's one of the reasons why there is such concern in the states about the bailout of the industry, ie. no wonder they aren't competitive when they pay twice the average salary. Taxpayer dollars are going in to prop up an uncompetitive, union run industry.
 
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