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Trends in US Employment
The financial woes and falling production of the Big Two US automakers, Ford and General Motors, have been highly publicized in recent years. Starting in 2000, as they watched their market share continue to decline, both Ford and GM shed thousands of assembly line jobs in mass layoffs. More recently, the Big Two have revealed plans to shut down over a dozen more North American plants as well as eliminate 60,000 more jobs through either layoffs or early retirement buyoffs.[8]
This decline in production has in turn led to a downturn in the domestic parts industry, as many suppliers who depended on large orders from Detroit to stay afloat have been forced into bankruptcy. This has led to an estimated 124,000 jobs to be lost in the parts sector of the industry.
Although total automotive employment has increased 8% since 1991, paying attention only to the endpoints overlooks a significant downturn from the industry's peak employment of 1,313,600 workers in 2000. From 2000 to 2005, total employment has actually dropped by 16%, with a recorded loss of 215,500 jobs.[9]
Both the assembly and parts sectors display declining employment, with assembly recording a 8% loss since 1990, and an even more dramatic 14% since 2000, and the parts industry losing 17% of total employment since 2000. Parts in particular are likely to be affected by increased offshore production, as US imports have increased 309% to $92.2 billion dollars.[8]
It is interesting to note, however, that foreign automakers have begun to take a heavy interest in opening US plants in order to be close to their largest market. Already, ten foreign-owned firms operate US-based plants, with even more planning to set up shot within US borders. For example, Korean-based Kia has announced plans to employ around 2,500 workers in a West Point, Georgia plant. In addition, Toyota Motor Corp. has announced its intent to shift production of the Camry, one of its best-selling models, from Japan to Indiana.[10] Thus, it is no surprise that foreign-affiliated employment of US automotive workers has increased dramatically since the mid-90s.
This increase in foreign investment, however, has not been enough to negate the decline in production by domestic firms, leading to ever-increasing rates of unemployment among auto workers. Even more cause for concern is the fact that jobs with foreign-owned firms are more likely to be non-union, thereby leading to probable decreases in benefits and possibly wages for American auto workers.
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