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Nafta jobs mexico { October 19 2002 } Original Source Link: (May no longer be active)
http://www.omaha.com/index.php?u_np=0&u_pg=46&u_sid=538025http://www.omaha.com/index.php?u_np=0&u_pg=46&u_sid=538025
Published Saturday
October 19, 2002
Goodyear to cut 480 jobs in Lincoln by 2003
BY JOHN TAYLOR
WORLD-HERALD BUREAU
LINCOLN - Goodyear Tire & Rubber Co. made it official Friday.
The Akron, Ohio-based company will replace $18-an-hour employees at its Lincoln plant with workers at a new facility in Mexico, who probably make no more than $12.77 a day.
Goodyear said Friday that it will begin construction immediately on a plant at Delicias, in the Mexican state of Chihuahua, that will begin producing rubber automotive hoses by 2004.
The action represented the final step in a plan that Goodyear announced last January. The plan, Goodyear said, was aimed at becoming more competitive.
The company, which has operated a plant in Lincoln since 1943, said it will phase out hose production at the plant over the next two years. Not affected was production of automotive and industrial power transmission belts, which are also produced at the plant.
In all, 480 employees with less seniority will lose their jobs. Based on the original announcement, the end would come sometime in 2003.
The company said it wanted to find cheaper ways to make the product.
The company said the site in northern Mexico was selected because there were enough skilled workers who had access to transportation. Goodyear also said the Mexican site would enable it to experience "lower-cost manufacturing," and will employ 225 workers there by 2004.
Skip Scherer, manager of communications for Goodyear, declined to disclose what the company will pay the workers.
The Mexican Consulate in Omaha, citing statistics from the Mexican Commission of Minimum Salaries, said the top pay for manufacturing jobs in Chihuahua was 127.14 pesos per day, or about $12.77 a day.
The approximately 1,200 production workers at the Lincoln plant are paid an average of about $18 an hour, or $37,440 a year, based on a 40-hour work week. They also have health and pension benefits.
Word of Goodyear's move of its hose production to Mexico didn't come as a surprise to Lincoln workers, who are represented by Local 286 of the United Steelworkers Union.
But it still didn't sit well with veteran employees like Michael Runyan, 47, who has worked at the plant for 19 years.
"We've been told year after year that we make a good product and that we're a good work force," he said. "The bottom line is that it really doesn't matter how dedicated you are or how good of work you do. It boils down to money."
During the summer, the union, the City of Lincoln and State of Nebraska tried to persuade Goodyear to retain all or some of the jobs.
John Shotkoski, vice president of Local 286, said Friday that his union had offered to institute a wage freeze and to agree to changes in work rules and seniority rights.
The company, he said, countered with a request that all workers at the plant - not just the 480 whose jobs were to be eliminated - take a 20 percent wage cut.
The union refused to consider a wage cut, but agreed to let members vote on whether they would take a wage freeze and make other concessions. On Oct. 6, the membership rejected that proposal - because, Shotkoski said, it would have saved only 100 jobs and Goodyear wouldn't guarantee that some hose production would remain in Lincoln.
Runyan, whose job involves placing clamps on radiator hoses, said that because of his seniority his job is safe, at least for now.
The concern of workers has now turned to what will happen in April, when the union's current contract with Goodyear expires, he said.
Runyan said there is a "real possibility" the company may use the union's wage-freeze proposal as leverage to get more concessions in a new contract.
Lincoln Mayor Don Wesely said Friday that the city, working with state government, had offered up to $1.5 million in state job training funds to help Goodyear "through these difficult economic times and to keep the jobs in the Lincoln plant."
The mayor said, however, that "low wages in Mexico and Goodyear's declining stock price had put pressure on the company to make this decision."
Goodyear's shares closed Friday at $8.37, down 30 cents, and down more than 70 percent from the high of $28.31 this year. In 1998 the company's shares were trading at $60.
Scherer, the Goodyear spokesman, said 60 percent of the production now done at the Lincoln plant would be moved to the new Mexican plant.
The company has not announced what it will do with the other 40 percent of its low-pressure hose production. Goodyear also makes low-pressure hoses at a Canadian plant and at another Mexican plant.
Mayor Wesely said his office will work with the Nebraska Congressional delegation to get federal assistance, available under terms of the North American Free Trade Agreement. Under NAFTA, workers whose jobs are moved to Mexico can receive up to $12,000 in federal funds for retraining.
The pending help provides little solace for workers like Runyan, who says that workers feel helpless in the face of Goodyear's actions.
Corporations like Goodyear "profess themselves as being good neighbors" and continue to receive tax breaks from the state as incentives to stay, he said.
"If they don't get what they want, they think nothing about packing up shop and heading to a foreign land," Runyan said. "And they want us, the consumer, to keep buying their products, when they are putting thousands of us out of work."
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