March 23, 2017

The renaissance of manufacturing in America.



Gummy bears!
"Most of all they just like the business environment," [Scott] Walker said.
Great. Now, legalize marijuana and we've got something.

37 comments:

320Busdriver said...

Meanwhile, back in Mikwaukee, Manpower is cutting some 150 jobs, mostly in IT. Workers have been told they are being replaced by cheap outsourced labor from India. They can receive their severance if they stick around and train their replacements. Disgusting.

David said...

Pleasant Prairie, just a hop, skip and a stumble from the Illinois border. All the transportation and market proximity advantages of Northeast Illinois without the failing state encumbrances.

California Snow said...

In high school I licked gummy bears and let them dry until they were nice & sticky then tossed them up to the ceiling where they were stuck forever. I regret nothing.

David said...

"[Manpower] Workers have been told they are being replaced by cheap outsourced labor from India."

They have not been told that, at least by the company. There have been some allegations in internet comments that this the case, but the company has not said so and no news organization has reported this. Manpower claims that they are reducing force because of already realized digitalized process improvements. The workers being let go are not IT workers.

Manpower is a big international company, with 29,000 employees world wide. Doubtless they do some IT in India, but there is no evidence that this layoff is a direct outsourcing.

One of the objectives of technological process improvements is to do more work with less employees. That's not changing. It's going to be one of the biggest challenges in the next decade or two. The answer is not to preserve inefficiencies. Only rapid economic growth resulting from more innovation will fill the gap over time.

TosaGuy said...

In Milwaukee, Manpower and Northwestern Mutual are replacing many IT positions with H-1B visa workers or subcontracting with a company that uses such people. Such people then are paid less than the former employees.

Mind you, it is not because these companies cannot find qualified help. They just don't want to pay for it. This flies in the face of the pro-immigration talking point pushed by the tech companies that they can't get qualified help in this nation.

The government facilitating importation of workers for this purpose is not free-market capitalism in any way.

Many of the left agree with Trump on this issue.

TosaGuy said...

David,

"Documents filed with the U.S. Labor Department show that the staffing company last year applied for visas for 212 foreign information-technology workers. Tech outsourcing firms have sought another 23 visas for foreign workers who would be placed at ManpowerGroup’s headquarters."

madAsHell said...

Great. Now, legalize marijuana and we've got something.

I'm not impressed with what I see in Seattle.

Meade said...

"I regret nothing."

I know. It's not like you were wiping boogers under your desk.

David said...

TosaGuy, what do you think that stat proves? They have 29,000 employees, a majority outside the USA, because heir markets are outside the USA. They are a worldwide temporary services firm. Companies like this rotate and train employees all over the world, and bringing them to HQ is part of the deal. Without more information that data tells you only what we already know: big successful international company.

Chuck said...

This is all a bit like the city of Detroit, and its surrounding counties.

In Detroit, everything business-wise gets magnified to an almost unbelievable degree, because everything is so politicized. Detroit liberals have made certain, that everything gets politicized.

So that if Whole Foods opens a grocery store in Detroit, it becomes, literally, front-page news. All of which made the County Executive of Oakland County (the wealthy suburban Republican county north of Detroit), L. Brooks Patterson, laugh about the fact that Detroit got more press for the opening of a Whole Foods store than Oakland County got for opening a $500 million technology center, or a new medical school associated with Oakland University. Brooks was right.

I am going to be on the alert for those kinds of imbalances in the Trump era. If this had been a Gummy-Bear factory opening in 2013, would Althouse have done a blog post? Maybe; it's Gummy-Bears after all. They are so cute and colorful and tasty, and there's Kardashian video. Would Scott Walker have taken credit? Probably. No; undoubtedly. And maybe with good reason.

But is this really a Trump post? The renaissance of manufacturing in America. Not "Wisconsin." The Wisconsin State Journal (which, I just realized, can get confused with the other WSJ) story contained nothing to speak of, about "manufacturing in America." It was a perfectly good, clear story about a Wisconsin plant for a Chicago-headquartered company. Seems like a good idea to me. Credit Governor Walker. The renaissance of manufacturing in America? That is Althouse's own headline.

Clark said...

I'm happy for Wisconsin. I love gummy bears. It pains me to say this, but Haribo gummy bears are an abomination.

David said...

Tosa Guy, I just ended a stint as Board Chair of a medium sized company here in South Carolina. IT is crucial to everything we do, and without it we would go broke. We have not outsourced or brought in foreign workers. (That's partly because of the nature of our business.) Finding qualified IT people is a major difficulty for our rather simple business. I have a child who works in SF for Peter Thiel running a venture capital fund for him, and a son in Seattle is a partner in one of the most successful IT consultancies in the world. Their issues finding qualified help dwarf my company's comparatively minuscule problems, mainly because they need more sophisticated people that we do. But at either level, there is a shortage of good people. A big shortage.

TosaGuy said...

I know exactly who Manpower is. The article also goes on further explaining that those H-1B workers earn about 30 percent less than the people they replaced.

The program is rife with abuse. Such people are trapped at their jobs until their Green Cards come through because if they leave, they have to restart the Green Card process. They can be worked longer hours and for less pay.

To your earlier point, automation is indeed here to stay and the fight against that is futile. However, bringing in foreign help basically as indentured servants so a company can fire Americans who they can't treat like that is something else entirely.

Also, I am a not "keep them out" side of this. Open the legal immigration process that puts the immigrant on a level playing field that doesn't favor the company, abuse the immigrant and unemploy the American.


320Busdriver said...

David, This information is in the newspaper.

"The great majority of the visas were for placement at ManpowerGroup until August 2019 and sought computer systems analysts who would be paid well below the average for such work in metropolitan Milwaukee."


"The median computer systems analyst wage in metropolitan Milwaukee in May 2015 was $37.67 an hour — 25% more than the pay the foreign workers would receive under the ManpowerGroup applications."

Coconuss Network said...

Haribo Gummi Bears - my favorite !! But always enjoy responsibly. I wouldn't recommend for any children for fear of choking. But alert adults, no problem. We get XXL packs. Lufthansa serves mini packs. $242 Million for the new Haribo facility -- whoa !!

TosaGuy said...

Then lets tighten the program so actual shortages get filled, but the company can't use the program to sidetrack dealing with its own employees.

This is the kind of garbage the will reignite the labor union movement and introduce their rot into the tech industry like it put into manufacturing. My point: companies need to manage themselves so others don't get the opportunity to do so.

David said...

Told my wife about the Gummy plant's $242 million cost and 400 employees.

Response: "For Gummies?! Man, they rot your teeth."

She has really good teeth.

Rick said...

I had the over/under on how long it took Chuck to turn the Gummy Bear thread into an anti-Trump diatribe at 20 comments. You can never be cynical enough about obsessions.

David said...

Tosa Guy: "Indentured Servants?"

You are thinking of Saudi Arabia."

320Busdriver said...

I don't think Manpower is bringing in help from outside because they can't find good help here. At least not in this case.

"More than 90% of ManpowerGroup’s applications for foreign workers call for the workers to be paid at the lowest of four levels specified in Labor Department guidance.
Such people do not possess highly specialized skills, the guidance indicates. In fact, it says that wage level is “for beginning level employees who have only a basic understanding of the occupation.”

Rick said...

320Busdriver said...
Meanwhile, back in Milwaukee, Manpower is cutting some 150 jobs, mostly in IT. Workers have been told they are being replaced by cheap outsourced labor from India. They can receive their severance if they stick around and train their replacements. Disgusting.


A decade ago I worked for a company that did something like this. In that case if they hadn't it would have gone bankrupt and everyone would have lost their jobs - compared to the few hundred or so who did. Sometimes things are more complicated than they appear.

Coconuss Network said...
This comment has been removed by the author.
David said...

320Busdriver said...
David, This information is in the newspaper.

"The great majority of the visas were for placement at ManpowerGroup until August 2019 and sought computer systems analysts who would be paid well below the average for such work in metropolitan Milwaukee."


"The median computer systems analyst wage in metropolitan Milwaukee in May 2015 was $37.67 an hour — 25% more than the pay the foreign workers would receive under the ManpowerGroup applications."


This tells you that they are filling vacancies. It does not tell you that they are laying off IT people to replace them with VISA entrants. Indeed, given the visa requirements as I understand them, that would be illegal.

You still have not made a case that what you say is happening is actually happening.

$35 an hour for IT people is not high level pay and they are probably not high level employees. There is a lot higher pay elsewhere in the US.

It is possible that what you allege is actually going on. I do not deny that. But you still have no evidence either that they are outsourcing these 150 jobs, or that they are importing visa holders to do those jobs,

Coconuss Network said...

Thomas Gottschalk - Haribo German Celebrity Endorsement. Resides in LA.

Chuck said...

Blogger Rick said...
I had the over/under on how long it took Chuck to turn the Gummy Bear thread into an anti-Trump diatribe at 20 comments. You can never be cynical enough about obsessions.


And the "over" is about five comments or about two minutes, on how long it takes for someone to attack me personally, no matter how gentle is any mention by me of Trump.

Obsessions.

Whaddaya say we let Althouse answer questions about her own headlines?

Coconuss Network said...

400 new Haribo facility jobs, yay !!

320Busdriver said...

David, you can listen to a letter written to radio talk show host Jeff Wagner. In it a woman describes how her daughter, an accountant with Manpower, was told her job was being outsourced to Indian labor. She was also told that she could get her severance if she successfully trained the Indian worker, who would then return to India to continue providing the accounting function for Manpower. It was in the first several minutes of yesterdays show. Found here.

http://www.wtmj.com/shows/jeff-wagner

Will Cate said...

Since I know you are watching Girls season 6, I thought you might tie this to the recent episode where Hannah's mom freaks out on cannabis gummies...

southcentralpa said...

I know Wisconsin if historically fairly German, but I'm surprised they didn't locate in Bismarck ...

California Snow said...

"I know. It's not like you were wiping boogers under your desk."

Ugh.... back in the day my wife's younger brother collected his boogers on his bunkbed railing. Nasty.

Next to the gummy bears was always a sharpened No. 2 pencil that was shot into the ceiling tile like a spear. Not saying I did it....not saying I didn't...just sayin.


Coconuss Network said...

"Haribo macht Kinder froh, und Erwachs'ne ebenso." Haribo Jingle. Careful of the children though. No Haribos, no bonbons. Just my 2cents.

Ann Althouse said...

"Since I know you are watching Girls season 6, I thought you might tie this to the recent episode where Hannah's mom freaks out on cannabis gummies."

That's what I was looking for to embed. Couldn't find it, and I loved this Jenner thing.

Chuck said...

Maybe Althouse isn't taking any questions, on the subject of her headlines.

John said...

I'm as glad as anyone to see more manufacturing coming to the US. Especially from overseas. (Not going to post anything about the Chinese company that makes Skechers coming to the US, Ann?)

Another gummy bear plant or 3 certainly doesn't hurt.

But this idea that we have been losing manufacturing is pure BS. Here's the numbers, in manufacturing output, in 2010 dollars, per capita, in the US per the late and lamented, by me at least, Statistical Abstract:

1970 $1,225
1980 $2,578
1990 $4,186
2000 $5,387
2010 $6,011

We have been losing manufacturing jobs. But the Chinese, Mexicans, Vietnamese and others are not the reason. From 1946 to 2016 the ratio of manufacturing employment to total non-farm employment has declined, in an almost perfectly straight line, from a bit more than .3 to a bit less than .1

http://mungowitzend.blogspot.com/2016/04/hey-trump-and-sanders-manufacturings.html

The reason is automation or, as some people hysterically call it "ROBOTS!!!!! OMG, THEY'RE GONNA KILL US ALL!!!!"

A bottling line that in 1970 took 40 or so people to run at 150 or so bottles per minute, now runs at 500+ bottles per minute with 4-5 people. Those are mostly people to bring caps, labels etc to the machines and schlep the finished bottles away.

See this video of Seagrams in about 1970

John Henry

John said...

I get emails from all over the US asking if I know any industrial mechanics looking for jobs.

If anyone here knows an industrial mechanic that would like to start at $40-50/hour (plus OT and benefits) let me know and I'll put them in touch.

Last fall I was talking to a project engineer from Giddings and Lewis in Fond du Lac at the IMTS show. She was moaning about the inability to hire enough skilled people to keep up with demand. They are losing business to imports not on price, not on quality, but on delivery lead times.

Because they can't find enough people.

She told me one of the problems was the 20% pass rate on drug testing. I thought she meant that 20% failed and said I could see it being a problem. She explained that 20% pass and 80% fail. That is a real pisser when 80% of the potential workforce disqualifies itself voluntarily.

I know another company that could expand if they could find more people. These are people who start, unskilled at $40m/yr or so and can earn over $100m as they prove themselves. Finding skilled people is his single biggest business challenge. Not finance, not sales, not supply chain, employees.

This is in a major US city.

A pharma client of mine in NYC told me that they advertised for 2 industrial mechanic positions. They got 300 resumes. In NYC! about 20 met the basic requirements, they interviewed 10 or so, didn't make an offer to any of them for various reasons. They are now working with a trade school in Minneapolis to scoop up their graduates.

He told me this over dinner in Puerto Rico 3-4 years ago. He was trying to find mechanics there willing to work in NYC.

I could go on and on and on with examples like this where I have first hand knowledge.

The employment problem in the US is at least as serious as the unemployment problem.

John Henry

Achilles said...

madAsHell said...
Great. Now, legalize marijuana and we've got something.

I'm not impressed with what I see in Seattle.


It was better when it was medical.

walter said...

No..make these cheese filled and we've got something.
I remember early primary era Trump suggesting we needed to increase H1Bs.