"In general it is impossible that manufactures should succeed in America from the high price of labour." -- Thomas Jefferson
To the men who used to work there, it is simply "the plant." This one is on the South Side of Chicago, but it could have been in Buffalo or Detroit, Cleveland or Pittsburgh. This one made automobile parts. But it might have made plumbing fixtures or machine tools, wire products or steel slabs.
Welcome to the postindustrial wasteland. Once home to more than 500 workers, today the factory stands nearly empty, an echoing cavern with windows cracked and grimy. A skeleton crew stands guard, fighting an unusuccessful battle with vandals. Outside, the smokestacks arequiet for block after block, and only the taverns are thriving.
A reborn economy?An entrepreneurial revival? It is easy, amidst the congratulatory hoopla, to forget that the changing patterns of business leave victims in their wake. What happens to the workers from that South Side plant -- or to those from the textile mills of Georgia and the rubber plants of Akron? Are they all expected to start computer outlets in Phoenix?
Analyze the dislocations, and you get no shortage of villains -- or scapegoats. Blame the Japanese, or the low wages paid to offshore workers. Blame the deficit, deregulation, or the dollar. Labor blames management, and management blames labor.
Nor is there a shortage of answers. Some believe that new technologies will boost productivity and make plants competitive once more. Others look to new ways of organizing and motivating people, and to new ideas about ownership -- ideas that promise to replace confrontation with cooperation.
However that may be, a reborn economy that forgets the men and women in "the plant" is doomed at birth.
"They just brainwashed us, buying some time to get this stuff overseas." -- Eddie Nowak
Until he was let go in November 1984, Eddie Nowak had worked for 13 years at the South Chicago Borg and Beck actory, a division of Borg-Warner Corp.
I still think this place could be run as a profitable business. What happened was total mismanagement. They used to make jokes about the product they manufactured. Nothing was put back into this plant. We have machinery in here so old they can't even get parts for it.
They never gave a damn about anybody who worked here. When it got busy, you were the number one guys. But as soon as that push was over with, that was it, you were crap again. They had meetings where they brought us up to the top floor when things were getting bad. They said, "We're going to have monthly meetings with you people; we're going to utilize your knowledge; we're going to call you up and talk to you on a personal, one-to-one basis." It never happened. They just brainwashed us, buying some time to get this stuff overseas.
When I was 21 years old, coming here, I thought I had something good for a long, long time. I'm not saying that this company wasn't good to me moneywise, but they just took the bottom right out from underneath and gave me nothing in return. I worked here for 13 years; I got a slip of paper in the mail that says I'm terminated. Not laid off, terminated. Thirteen years, shot.
If you really think about it, the person who works in this factory spends most of his waking hours here. It's like his home, really. And when that's taken away from you, that's like getting kicked out of your house, somebody taking your home away from you.
I've known people who went to California to try to find work, and came back. People who went to Texas, they're back, too. They talk about the jobs there.Sure, you can open up the paper on a Sunday and see that McDonald's and Burger King want management traionees, starting at $8,500 a year. For a guy just out of high school, it may be something to think about. But if a guy's got two or three kids, he's past mid-age in life, it can't work. Factory work is finished anyway. Pretty soon, it's going to be nothing but services, some guy running around slipping in new computer panels for $7 an hour.
"There's going to be a viable steel industry in this country. It's just not going to be composed of the big companies." -- Peter Dillon
Peter Dillon is vice-chairman of Northwestern Steel and Wire Co., a New York Stock Exchange-traded business founded in 1879 by Dillon's great-grandfather.
People just don't realize what's happening in the steel industry. ten years ago, there were 750,000 jobs. Five years ago, there were 500,000 jobs. Today, there are 225,000, if you're lucky. There's no way we can compete with foreign countries, where 60% of steel manufacturing is either government controlled or government subsidized. All they do is operate seven days a week, three shifts, pumping out the steel. They don't have to worry about a bottom line.
Our best year, 1981, we were just a hair under a half-billion dollars. Since then, we've had the lowest steel consumption since the Great Depression.Our sales have fluctuated all the way down to $168 million.
During this period, we installed two of the world's biggest continuous casters. We updated our furnaces. We added the latest metallurgy. We closed down two mills. We completely gutted one mill and made it two modern mills. We went through a seven-month concession shutdown with the steelworkers on our wire-and-rod division, and we got about a $7-an-hour reduction in wages and benefits. But we haven't made money for the last 14 quarters now. Instead, we've lost more than $97 million.
I think there's going to be a viable steel industry in this country. It's just not going to be composed of the big companies anymore. They're going to be minimill-type operations, closer to their respective markets, with much shorter product lines.
I also think you're going to see a lot more employee ownership of troubled industries, because that's the only way to get people involved in their business. I think that would make a helluva difference. You can't have macho unions and macho managers bashing each other anymore. After companies have achieved significant reductions in wages and benefits, the only time you can go back and ask for more is if you're going to offer people a piece of the rock. Maybe there isn't room for the typical investor anymore; maybe the margins are going to be so tight and the competition so keen that the shareholder and the employee are going to be one and the same.
