Delaware workers sing blue-collar blues

BYLINE: ERIC RUTH {dcidc}Contact Eric Ruth at 324-2428 or eruth@delawareonline.com.

The News Journal

For decades, chuffing factories helped thousands of Delaware families hold fast to their own piece of prosperity. Today, as more factories fall silent, Delaware's blue-collar dream seems a little less sweet.

"The blue-collar worker today, they're slowly phasing us out," said autoworker Lou Gardner, a 28-year veteran of the assembly line at General Motors near Newport. Now, with the announced closure of the Chrysler plant in 2009, he and other blue-collar workers here are looking toward a future that seems to hold less hope for such solid jobs, and less chance for the kinds of opportunities that lifted so many into the middle class.

Ralph Sumner worked at the Chrysler plant in Newark for 30 years before retiring. His father and brother worked there and now his sister, who still works there, faces a buyout or layoff.

"I feel bad for my UAW brothers," said Sumner, sipping coffee last week in the Eagle Diner near the plant.

While the state navigates an economy hit by layoffs and shutdowns, the potential for new blue-collar jobs still exists. Starting in 2010, W.L.Gore & Associates may expand its medical services products division on property the company owns near Newark. Highway and home construction continue to be integral to Delaware's economy, providing a stable lifestyle for many workers. Decent-paying blue-collar jobs are being created every day. The question is whether Delaware can sustain a steady blue-collar job market.

The long-running national debate over how to continue America's blue-collar prosperity has brought little consensus. Some analysts say the solution is more unions; others argue for fewer. Some blame free trade; others see it as global opportunity. Depending on who's talking, the American middle class is either being squeezed into virtual poverty or better off than ever.

For decades in Delaware, blue-collar prosperity has been symbolized -- and fueled -- by the auto assembly plants. With the fate of Chrysler's plant decided, the General Motors plant now stands alone, its future bound up with the same global dynamics that battered Chrysler.

"I would say this plant's got another five or six years to go," GM worker Gardner said. Autoworkers predict the slide of the plants will be accompanied by more blue-collar losses in the years to come -- along with ever-fatter paychecks for executives.

"Pretty much, it's gonna be [either] you're on the high end, or you're low-income," said Gary Sullivan, a 27-year veteran of the line at GM.

{}Sobering statistics

Delaware was the only state to lose manufacturing output from 1985-2000, according to the Northeast-Midwest Institute, a nonprofit that works to promote the economic vitality of those regions. While the state's blue-collar work force stands at 88,000, about 4,000 more than in 1990, its share of the total labor force has dropped about 23 percent in that time, according to Ed Ratledge, director of the University of Delaware's Center for Applied Demography and Survey Research. Expansion in the state's white-collar financial sector contributed to the falling percentage of blue-collar workers in Delaware's labor force.

As technology becomes more crucial in business, manufacturers demand better-skilled workers than they once did, said Steve Quindlen, director of the Delaware Manufacturing Extension Partnership, which helps businesses develop leaner, more productive processes. The global economy also has lured many of the nation's manufacturing jobs overseas, and pressured its plants to close.

Between 1999 and 2004, the U.S. lost 40,423 manufacturing plants. From 1998-2005, it lost 3.4 million manufacturing jobs.

In Delaware, 13,900 manufacturing jobs -- almost 20 percent -- were lost from 1990-2001, according to the Northeast-Midwest Institute.

"It's clear that the future of blue-collar employment not only in Delaware but throughout the United States is looking increasingly grim," said Alan Tonelson, research fellow at the U.S. Business and Industry Council. The nation's leaders are allowing foreign nations to stack the deck when it comes to "free trade," putting U.S. industry at a competitive disadvantage that even its own officials sometimes don't recognize, he said. "The Big Three automakers ... are astonishingly incapable of either understanding the true global competitive situation they face or, certainly, articulating this."

Tonelson wants America's leadership to impose emergency tariffs on some imports until other nations stop the subsidies and other manipulations that give them much of their advantage over U.S. manufacturers. "It creates a hidden subsidy for foreign products coming into the U.S., and it imposes a hidden tax on U.S. products that are sent into foreign markets," Tonelson said.

{}Global conundrum

But global trade can be an engine for more jobs as well as a way to lose them.

"It's not just the jobs going to China, we're getting robots to do these jobs instead," said James Sherk, a labor policy expert at the Heritage Foundation. "This has been happening since the 1950s."

Allowing other countries to take away manufacturing capacity that they can operate more cheaply ultimately benefits blue-collar workers and all Americans, he said, by allowing better and more affordable products to reach the market. "Not everyone wins, but the vast majority of people win."

The biggest winners, Tonelson said, are the multinational corporations that have come to dominate trade. "They benefit from China's cheating" on its currency value, and politicians seem disinclined to upset the corporate profit cart. "They've produced {dcidc}bupkus," Tonelson said.

By allowing foreign automakers to build plants here, the government gave them a competitive advantage through tax breaks, he said, and allowed them to start plants with relatively low numbers of retirees and higher-wage older employees.

The continued threat of this situation could eventually come to Delaware's GM plant, he said. "Assuming that the [global trade] situation doesn't change dramatically soon, I would argue that the very best that factories like that could hope for is a very significant downsizing," Tonelson said. "There's much more to come. Chrysler seems to be at an earlier stage in this process" of retrenching than other U.S. automakers.

The GM plant does boast advantages that some U.S. auto plants may not have, said Quindlen, who once was a manager of training and development there. Its work force is efficient, and its union and management have developed a solid working relationship, he said. "All the right things were going on in that plant. That's why they have the cars they do now," he said of the successful Pontiac Solstice, Saturn Sky and Opel roadsters being built there.

"I think GM Wilmington will be there for a while," he said.

GM's health and the future of other good blue-collar opportunities also depend on adaptability, Sherk said. "Companies have to be more involved, they have to be more flexible. Unions have to realize they're not going to get all things, like paychecks during layoffs. You just can't pay workers for doing nothing in the global competitive environment."

That attitude miffs GM and Chrysler's autoworkers, who say reports of their generous perks are overblown, and believe critics fail to consider the physical price they pay for their salaries.

"They think we're in there twiddling our thumbs," said Sullivan, 46, who has torn a tendon and has undergone two foot operations from his work on the line.

Gardner, 48, also has gone under the knife to fix on-the-job injuries. "Yeah, it's a high-paying job, but we earn every penny."

{}Looking ahead

Over the long term, good blue-collar employment can endure, but it will require a focus on educating workers for the high-tech demands of today's businesses, Quindlen said. Some already exists at the state's schools, and community colleges hold much potential for quickly training and retraining to meet demand, he said.

"I think we may want to evaluate whether that training meets the needs of the manufacturers that are out there," he said. "They're doing stuff, but I'm not sure it's collectively being done. It's a scattershot approach."

The right kind of education doesn't necessarily have to be expensive or time-consuming, said Christian E. Weller, senior economist with the Center for American Progress, a liberal-progressive Washington think tank. "Right now the vast majority of jobs don't require a college degree. The projections over the next decade don't change that."

There's also some sentiment that improving education is a goal we've heard before, and been disappointed in before.

"We also clearly don't know how to fix the schools, because we've been talking about it for 30 years with almost no progress," Tonelson said.

It's also crucial to carve out a system that attracts and prepares for not just any new job, experts said. The state's employment situation is fairly strong, but leaders worry that too few of them offer the kind of pay that helped support the state's blue-collar middle class for so long. In Delaware, manufacturing-sector workers earned an average of $52,500 in 2005, $8,000 more than the average Delaware worker.

"We can't just have all service jobs," Quindlen said. "We've gotta have somebody that has the money to pay the service guy."

Delaware's work force now has a slightly smaller share of manufacturing jobs than the nation, mostly because of a faster-than-average decline in such jobs here, according to the Northeast-Midwest Institute. A larger proportion of Delaware's blue-collar jobs are now in construction trades, among the strongest well-paying working-class jobs around.

As manufacturing jobs vanish, other fields are expected to be strong through the next few years. The defense and environmental industries offer a lot of potential, Quindlen said, and the Bureau of Labor Statistics sees solid growth in the building trades and health care. It also helps that the state is finally resolving a high-cost workers' compensation insurance system that put local businesses at a disadvantage, he said.

"On average, we're creating higher-paying jobs and losing lower-paying jobs," Sherk said. "And that's a good deal for the country."

{}Making changes

Still, older blue-collar workers around the country are finding it more of a struggle to make the transition to those jobs, some experts contend. Some blame a waning federal commitment to job training and job programs -- Department of Labor expenditures fell from $63 per worker in 1986 to $35 per worker in 2006, according to the Economic Policy Institute.

"It's really being a futurist," Quindlen said. "We have to look at what are we going to need five years from now."

The state has to be willing to pay for the infrastructure that prepares young people for those jobs of tomorrow, he said. "If we want the jobs, we have to make some choices. It's tough to do."

Compared to the nation, Delaware enjoys the advantage of being relatively healthy in several areas. The productivity of Delaware's manufacturing employees is 20 percent higher than the national average, according to a Northeast-Midwest Institute report.

A 2004 national report by the Working Poor Families Project found that more than 1 in 4 American working families now earn wages so low they have difficulty surviving financially -- less than $36,784 in 2002. In Delaware, 18.6 percent of families were in that bracket, the ninth-best showing in the nation, according to the report.

Steps are under way in Delaware to cope with the changing economy. Delaware led the nation in providing educational opportunities under the Workforce Investment Act, and the state recently reported that it boasts the nation's highest percentage of manufacturing jobs supported by foreign companies. With the Blue Collar Job Act, the state also aims to attract and keep well-paying jobs by offering firms breaks on their income taxes, gross receipts tax and public utility tax.

"There's a lot of good stuff going on" in Delaware, Quindlen said. "There just may not be enough of that good stuff."

{dcidc}Contact Eric Ruth at 324-2428 or eruth@delawareonline.com.

{}PROSPECTS

{}Transportation, building trades offer job growth

Amid the gloom of layoffs and plant closures, there is room for hope when it comes to well-paying blue-collar jobs. Using data from the Bureau of Labor Statistics, the job Web site Careerbuilder.com compiled a list of several manual and technical labor jobs that show promise in the years ahead. Construction jobs are expected to grow 12 percent by 2014, and the transportation and material moving industry could add 1.1 million jobs by then.

Here are the top 10 blue-collar jobs based on current salary medians and expected growth by 2014:

{}Construction and building inspectors

ANNUAL PAY: $43,670

EXPECTED EMPLOYMENT GAIN: 18 percent to 26 percent

{}Waste and wastewater treatment plant and system operators

ANNUAL PAY: $34,960