“This Is Really A Symbol Of What’s Going On In This Whole Country. We’re Losing Middle-Class Jobs”

Tyler Durden's picture

We wish we could say we didn't warn Boeing's machinists about the key trend taking place in the US economy under the Obama "recovery" but unfortunately we did. Three years ago, to be specific, when we wrote: "Charting America's Transformation To A Part-Time Worker Society" and followed it up with "A "Quality Assessment" Of US Jobs Reveals The Ugliest Picture Yet" in which we explained that while the propaganda machine was fixated on numeric, quantitative, job additions every month, what has subversively going on, was the constant deterioration in the quality of jobs - and specifically the declining wages - available to those Americans who had not rotated outside of the labor force permanently (currently at a record 91.5 million). We say "alas" because it once again took several years before our cautions to be felt by the broader population, in this case the Boeing machinist union struggling to extract a wage increase from its employer: Boeing, whose stock keeps hitting new record highs with every passing day.

The machinists' lament is well-known to virtually everyone who relies on labor instead of capital to exist: pay us more. Bloomberg reports:

“We need to focus on how many jobs there are that give an adult a chance to earn a decent living,” said Gordon Lafer, an associate professor at the University of Oregon’s Labor Education and Research Center in Eugene. “Too much of the discussion has been about the number of jobs, and that’s obviously important, but there’s also a crisis in the quality of jobs.”

That's ironic: when we said it first three years ago, the mainstream media mocked it. Curious how things change when that hope you once believed in becomes a "zero balance" nightmare at the ATM machine, eh?

Blame it on the Fed, blame it on globalization, blame it on corporations who have a virtually unlimited labor, cheap and global pool to pick from, but the bottom line is US workers have zero leverage.

Where unions and their allies see reason for alarm, employers see a way to retain jobs against the lure of lower wages overseas. There were about 12 million U.S. factory jobs in October, buoyed by recent gains while still down 39 percent from 1979’s peak.


“We certainly have seen manufacturers become much more competitive,” said Chad Moutray, chief economist at the Washington-based National Association of Manufacturers. Falling labor costs have helped “keep U.S. manufacturers much more competitive and you’re seeing more investment in the U.S. as a result.”

The good news for workers: each day of pain for them means a day of joy for the shareholders - typically those in US society who already are the wealthiest.

Manufacturers’ after-tax profits rose to a record $289.1 billion last year, more than three times 2009’s tally, the Commerce Department reported. The Standard & Poor’s 500 Industrials Index has more than tripled since its 2009 low, and topped the broader index by 59 percentage points over that span.


“What’s being referred to as a recovery in manufacturing is to a large extent a recovery in profitability,” said Dean Baker, co-director of the Center for Economic and Policy Research, a Washington-based group funded by unions and private foundations. “That’s good for the companies and good for the shareholders but it’s not necessarily good for the workers.”

To some, labor's epic lack of leverage has to do with lack of unionization to take on greedy coroprations.

Some of the states where factory jobs are growing the fastest are among the least unionized. In 2012, 4.6 percent of South Carolina workers were represented by unions, as did 6.8 percent of Texans, according to the U.S. Bureau of Labor Statistics. New York, the most-unionized, was at 24.9 percent.


Assembly workers at Boeing’s nonunion plant in North Charleston, South Carolina, earn an average of $17 an hour, compared with $27.65 for the more-experienced Machinists-represented workforce at the company’s wide-body jet plant in Everett, Washington, said Bryan Corliss, a union spokesman.


Higher wages also no longer go hand-in-hand with union jobs, as they once did.

But the reality is that in a world drowning in overcapacity, and in which globalization, technological innovation and improvements in productivity mean that Boeing can open a plant anywhere else in the US, or in the world and still pay less than it does currently, even if it means a lot of unhappy, and unemployed labor workers. For example:

General Electric Co. says it has added about 2,500 production jobs since 2010 at its home-appliance plant in Louisville, Kentucky. Under an accord with the union local, new hires make $14 an hour assembling refrigerators and washing machines, compared with a starting wage of about $22 for those who began before 2005. While CEO Jeffrey Immelt has said GE could have sent work on new products to China, it instead invested $1 billion in its appliance business in the U.S. after the agreement was reached.


The company is also moving work to lower-wage states. In Fort Edward, New York, GE plans to dismiss about 175 employees earning an average of $29.03 an hour and shift production of electrical capacitors to Clearwater, Florida. Workers there can earn about $12 an hour, according to the United Electrical, Radio and Machine Workers of America, which represents the New York employees.

In summary: here is the corporate speak:

“GE’s business units continuously review their operations and sometimes have to make tough decisions to keep up with market trends, address customer demands or reduce cost,” Duchamp said in an e-mail. “The intention of the proposed move is to address the increasing cost pressures and leverage the resources” available at the Florida site.

And here is the worker speak:

This is really a symbol of what’s going on in this whole country,” said Machinist Thomas Campbell, 40. “We’re losing middle-class jobs.”

What is sad is that both are correct, and while Bernanke and his wealth effect policies do everything to make the rich, and the corporations, even richer, they continue to rob what little standard of living America's workers have, and in the process continue to destroy what little is left of the middle class. Once again, as we warned, so long ago.

Tim Geithner was only kidding about "welcome to the recovery" - what he meant was "welcome to the new feudal system."

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csmith's picture

Boeing Airlines ?

azengrcat's picture

BA = Burning Airplanes


Running On Bingo Fuel's picture

Boeing, "a global force for good". Protecting the troops.


Skateboarder's picture

At least the Volga barge haulers toiled for something real.

Ying-Yang's picture

"They continue to rob what little standard of living America's workers have."

The downward spiral carnival ride that's screws you into the ground until the carnies are run out of town.

James_Cole's picture

But the reality is that in a world drowning in overcapacity, and in which globalization, technological innovation and improvements in productivity mean that Boeing can open a plant anywhere else in the US, or in the world and still pay less than it does currently

And half of Boeing's revs come from who? And how much of their profit margin?

Send Boeing to China and remove their .gov contracts + tax breaks and see how long they last. 


Four chan's picture

ross perot should have been president.

Anusocracy's picture

Perot got rich off the government.

Oldwood's picture

Just becasue he could see what was happening. Business people are not evil because they can see the trends and what is happening. He tried to warn us...repeatedly. He spent is own money running for president, all while telling us what would happen...and Americans thought he was an old foolish crank. Everyone on this site is trying to figure out where this is going and how to profit if not simply survive it. We have people telling us how it will be and we call them nuts. When smart people try and explain it to us and actually profit from their predictions, we call them evil. We are fucked. The truth was to set us free, but now will likely only send us to prison or death

Anusocracy's picture

I have no need for, nor respect for, anyone who got rich off of stolen money.

The government 'Elite Get Rich' scheme needs to end.

BorisTheBlade's picture

A giant sucking sound, it was said in 1992:

To those of you in the audience who are business people, pretty simple: If you're paying $12, $13, $14 an hour for factory workers and you can move your factory South of the border, pay a dollar an hour for labor, hire young -- let's assume you've been in business for a long time and you've got a mature work force -- pay a dollar an hour for your labor, have no health care -- that's the most expensive single element in making a car -- have no environmental controls, no pollution controls and no retirement, and you don't care about anything but making money, there will be a giant sucking sound going south.

It was said as simple as a 5 year old with little business acumen could grasp it, yet majority chose to ignore. It was perhaps too simple and too obvious and too logical to be heard at the time. You reap what you saw, ignoring basic economic gravity will not make you fly, it will just hit you later and with much worse consequences. Madness.

sylviasays's picture

Some other interesting facts about General Electric and it's CEO Jeffrey Immelt who is also the head of Obama’s Economic Advisory Board:

Since Immelt took over GE in 2001, the corporation has shed nearly 34,000 jobs in the U.S., according to its annual filing with the Securities and Exchange Commission in 2011. But it has added 25,000 jobs overseas. At the end of 2009, GE employed 36,000 more people abroad than it did in the U.S.  In 2000, it was nearly the opposite.


GE has paid well below the top marginal corporate tax rate of 35 percent.  GE has paid an average tax rate of just 1.8 percent over the past decade, according to an analysis in a report by the non-profit advocacy group Citizens for Tax Justice. For 2002, 2008, 2009 and 2010, according to the report, GE did not pay a cent in federal income taxes, and indeed got substantial tax refunds back from the government. However, GE paid taxes at a rate of 11.3 percent in 2011.


Jeffrey Immelt pocketed $25.8 million in total compensation in 2012 -- a 20% jump from the prior year.


By any measure of shareholder value, GE has been a disaster under Jeffrey Immelt with shareholder value declining almost 40 percent.




James_Cole's picture

GE also a big recipient of .gov dollars (MIC contract$ in particular).

prains's picture

McShitInYourMouth Drive Thru......it's real, it's coming sooner than you think, AND you will drink it ! Bitchez !


...and learn to like it, but probably take about a century of bloodshed, but you will drink it.....


or not

max2205's picture

Day after day we get these same stories...guess what ...Barry has spent 1 trillion a year for 5 years on the FSA and now its become an institution and a fixed cost....we're fucked...get over it


FAS FSA FSA fsa f  s a

Seasmoke's picture

Stop complaining. We all could have become public employees. At least that's what teachers and cops tell me at parties. 

aVileRat's picture

Only going to get worse when the layoffs start rubberbanding into the 1Q14

If those holiday spending numbers do not bring Jesus to every Visa card in the world, its going to get choppy.

Who's got some Jim Simmons Lucky Strikes ?

Say What Again's picture

If the government is employeeing everyone, how come my streets are full of pot-holes, the bridges are crumbling, and the gov-service offices have wait time of 2.5 hours?

TBT or not TBT's picture

Actual work is mostly bid to union saddled private cronies at well over rates that would prevail without prevailing wage laws etc.

oddjob's picture

People in government will always hire someone less smart than themselves. The downward spiral in ethics and productivity is clearly evident.

Vendetta's picture

a trillion for the MIC, a trillion for the bankers, $2.5 trillion in revenue  ... what do you think

Serenity Now's picture

He said they were employed; nobody said they were working.  ;)

Surging Chaos's picture

It's good to work for the public sector.

For now though.

Once more cities go bankrupt (and it will happen sooner than later since cities can't print money), the muni market will experience its Lehman moment. That's when you'll start seeing a tidal wave of cities declaring bankruptcy once they realize it's the only way to get out of all the pensions they promised to retirees. I hope public sector employees enjoy getting pennies on the dollar.

RSloane's picture

In the public sector, unions are an easy target yet no one goes after the politicians who signed those contracts in the first place. Unions had to negotiate with someone to get a contract. It just fucking pisses me off that the workers are the target and the politicians get to retire with whatever astronomically stupid retirement they thought up for themselves. There's another muni bankruptcy in CA in the wings right now. Some bullshit poli fucker made a patronizing speech to the public workers about how they grew to expect too much. If that's true, why did the city wait until bankruptcy was knocking on their door? Did it just occur to them that maybe perhaps their inefficient management led to the bankruptcy in the first place?

Sorry I get really pissed about this. [This was not directed at you Chaos I enjoy your comments]

/rant off

Surging Chaos's picture

Well the thing with public sector unions is that you're really bargaining with taxpayers since the money is coming to the workers and retirees at the end of a gun. That affects me and other people directly (unlike private sector unions, though crony capitalism there can make things murky) which is why public sector unions are a ripe target. I can't do a whole lot to stop someone like the SEIU from paying their employees 6 figures with ridiculous pension plans for the next 30 years due to the coercive nature of the state. Even the FDR, the poster child for progressives, did not like public sector unions.

And thanks for the compliment! ;)

Anusocracy's picture

Unions work to elect pro-union candidates.

Pro-union politicians sign pro-union contracts.

Other interest groups do the same.

MO for government growth.

Taxpayers get screwed.

Can we see a problem here?

TBT or not TBT's picture

Please come punish governor moonbeam in any sick way you like. California got this way by buying off and multiplying the numbers of public service unions to their current proportions. Dem supermajorities in both the house and senate, and moonbeam signing just about anything.

Vendetta's picture

The pension fund 'managers' and 'planners' were looking for 8% returns annually.  When is the last time they've seen that since interest rates have been so low for so long while quality jobs disappear as fast as a turd in the globlized toilet

Herd Redirection Committee's picture

Whats going to be crazy though is explaining to them they were being overpaid, in addition to being lied to, in regards to future benefits (which they will feel entitled to).

starfcker's picture

funny as hell to do business with 50 year old retired .gov types. i get a serious kick out of explaning to them that they are the reason i have to charge them so much. even funnier is listening to them bitch about their property taxes (really). most clueless group of people i can remember. i honestly don't feel bad about what the future holds for them, they helped themselves to my taxes, and wasted tons and tons more. it was not too much to expect a basic level of honesty and decency from these people, and payback is a bitch. ignorance is no defense.

Oldwood's picture

We can all see the problem, unless of course we are the problem.

lasvegaspersona's picture

In Weimar Germany all pensions were paid. By 1924 you could not buy a postage stamp with a month's allowance.

Vendetta's picture

exactly.  from what I understand a Boeing employee is to receive $90 a month for each year of employment.  That equates to $1080 dollars annually and is not unreasonable.  If the company invests $1080 every year in the pension fund (I have heard of pension funds being underfunded for years and years which is disturbing given  $1080 a year is not a lot of money relative to someone earning ~$40k to $50k or more) and the value of that money isn't eviscerated, the retiring employee can expect to retire comfortably after working an appropriate number of years  (if 30 years, $2700 a month) but the value is being eviscerated by the bankers and politicians and their lame brained treasonous shenanigans.  Even with the BS inflation rate of 2% is accrued over the duration of the 30 years, that's an evisceration of 60% of the original value of the pension.  So effectively the monthly pension fund is actually worth $1,620 in real terms.  NOW add in the REAL inflation rate and it is easy to see how easily pensioners are royally fucked over just by the criminality of a system that is against everyone but the wealthiest among us.

Jack Burton's picture

As a kid I was taught to respect cops and to treat them as friends of honest society and such. Well, times change. Repsect them? Look at most of them today, young punks on a power trip. They become cops for two reasons, one: to push people around, two: to collect big paychecks, big benefits, early retirement with job security. Society pays them and they turn on society like we are rabid dogs needing to be kicked into the gutter. They are now at a point where they isolate themselves socially from all non-cops. Even in the little town I live in, the city cops and and county cops on talk or socialize with eachother. Like they are now to superior to even be seen talking to a citizen. Fuckers make me sick to my stomach.

Gringo Viejo's picture

The "knockout game" is just a harbinger of what's coming.

If you're not prepping, God help you.

fonestar's picture

Or maybe "the knockout game" is just more race-baiting from the same MSM that brought you classic hits like, "Sandy Hoax", "The Batman Shootings", "Alex Jones nut attacks LAX", etc, etc?

Gringo Viejo's picture

@fonestar.....GL. Like the old Murphyism.....you never try to teach a pig to sing. It wastes one's time and annoys the pig.

Running On Bingo Fuel's picture

$10,000 for that video bro. Lispy faggot is the target.

Cash, gold, coin IDGAF. Just get the clip.


fonestar's picture

I'm not saying that all of the attacks are fake but I am saying that people should question whatever the MSM reports these days and their reasons for doing so.

superflex's picture

When a white cracka gets attacked, it's OK

When a Tribe member gets attacked, it's news.

Does that clear it up for you?

DaddyO's picture

Fear, the great motivator. If you want to move an 800lb cow, turn Willy the cowdog loose on her arse.

She'll move.

She's been conditioned to move since she was a little calf.

Ever seen the little rope that holds an elephant in place at the circus?

When the elephant was a little calf, they tied her up with a logging chain, now she won't move because she believes she can't.

TSA is doing the same thing, the unions have conditioned their members, on and on it goes.


Offthebeach's picture

So, early '80s I'm going through the 82nds junior NCO academy. Were praticing expections by inspecting each others locker.
The whole thing is just pissing/bumming me out.
Even our underwear had to be folded and stacked a certain way.Such a pain that some had their stack of tighty whiteys sewn together by the Korean ladies that sowed all your rank and stuff on your uniforms.
Anyways I ask the old instructor what the hell stacked underwear had to do with killing people.
He said if the Army could get you to stack underwear, or a hundred other chicken shite stuff, yould do anything.


Its all about the conditioning.

GreatUncle's picture

A soldier is conditioned to follow orders etc. and society conditions people.

When the conditioning fails it is like pandoras box opened up.

So the conditioning we received about money, investments, etc are all

good = conditioning still in place -->> Sheeple.

s^&t = rigged game conditioning fails -->> ZH people and the like.

Sparkey's picture

You are smart Daddy! Thanks for your comments.

DaddyO's picture

My wife and kids would beg to differ...

Hang around here and you'll read stuff from some really smart people who post on ZH.

I'm just an old fart whose fallen off the turnip wagon enough to know it hurts.


nc551's picture

They did a study with monkeys or apes or some primate.  Put 3 in a room with a ladder that leads up to some food.  When any one monkey goes up the ladder to the food they hose the other two monkeys with ice cold water.  Before you know it no monkey can go up the ladder without being attacked.  Then you turn off the water and start swapping out the monkeys.  By the end of it you have 3 monkeys that have never been sprayed with water, that would never be sprayed with water, ferociously keeping any other monkey off that ladder.  Voila, tradition.

Zero Point's picture

I saw a funny one once.

They were giving this monkey a slice of cucumber every time it performed some trask.

It was happy as Larry, doing this little task, and then getting it's cucumber.

Then they put another monkey next to it, doing the same task, only they were giving him grapes (apparently a monkey favourite).

The first monkey watched this for a while, then chucked a tantrum and refused to do his task, the cucumber now beneath him.

If looks could kill the monkey with the grapes (who was eating his grapes with a big dirty grin mind you), would have been vapourised.

Class warfare. Fucking hilarious.

JohnG's picture



It isn't race baiting because race is very rarely mentioned in MSM accounts of these violent attacks.

It is a nationwide epidemic however.