When it comes to the auto companies, we often focus more on the lake than the streams and rivers.
That is, much of the attention to how this critical sector is faring focuses on the end-of-the-line assembly plants, and less on the suppliers that provide the parts to be assembled.
You might think that's because in employment terms, the end-of-the-line is most important. But in fact, for every worker in the assembly plant, there are three workers in the supply chain.
So if you want to assess the health of the auto industry, you've got to look beyond the factories that build the cars and trucks and examine how the suppliers are doing.
With that in mind, Vice President Biden traveled to Toledo, Ohio, today to hold a Middle Class Task Force event at the Chrysler Toledo Assembly Complex. This state-of-the-art complex houses the main assembly plant producing the Jeep Wrangler, surrounded by three of the plant's suppliers.
It's one impressive complex and a great example of how the industry in general, and Chrysler in particular, is emerging from its dark days leaner, stronger, and with new-found efficiencies. In fact, this facility twice received the Harbour Award as the most efficient assembly plant in North America.
They achieve these efficiencies by locating their major suppliers right next door, providing direct and uninterrupted flows from their assembly lines right into the plant. Such intimate flow control means much less down time -- simply put, workers at the Wrangler plant don't spend time waiting for parts.
The Vice President's remarks emphasized these and other aspects of the supply chain. To help make the point, he displayed this visual, showing the suppliers which provide parts directly to the Wrangler assembly plant. These top-tier suppliers alone represent 3,000 American jobs. Other suppliers, one link down the chain, create additional jobs across the country supplying parts to the top-tier folks.
So when a plant like the one we visited runs two shifts, as is currently the case, that doesn't just mean jobs in Toledo. It means jobs all along the supply chain, in places like Grand Rapids, Michigan; Dry Ridge, Kentucky; Greensburg, Indiana; and other communities all over the country.
As I watched the Vice President meet with workers at this great manufacturing plant in the heart of the heartland, I couldn't help but flash back to the early days of our auto task force. Back then, it was by no means certain that these men and women would be able to keep their jobs making cars.
But even while some in government and from the pundit class urged the President and Vice President walk away from this industry, they wouldn't turn their backs. Instead, they bet on the American worker, on the uniquely American spirit of renewal, and on the faith that the key stakeholders would do what was needed to once again make this industry a global contender.
And that bet is paying off.
In the year before we took office, the auto industry shed 431,300 jobs. But in the 13 months since GM and Chrysler emerged from bankruptcy, auto industry employment has increased by 76,300, a huge reversal -- one we'd never have seen had we listened to those urging us to walk away.
Of those 76,300 new jobs, close to 40,000 come from the suppliers. That's the fastest year over year growth that they've seen in a decade.
They're good manufacturing jobs, right here in America, staffed by highly productive men and women doing two important things: they're building great new vehicles, and they're writing a new chapter in the history of the American auto industry.
It's a story of hard work and sacrifice by the companies, the workers, the unions, investors, and others over the last year. It's a story of a bold new President and Vice President standing by a core American industry in its time of need, carefully structuring a temporary intervention designed to get them back of their feet.
And it's a story that is by no means over. The industry, much like the overall economy, is moving solidly in the right direction, but it's still got a ways to go.
Vice President Biden and the Middle Class Task Force were happy to be a part of the story today, and we'll continue to watch it and tell you about it as it evolves.
Jared Bernstein is Chief Economic Advisor to the Vice President
When a lot of the layoffs were announced years ago the people announcing it stated that the layoffs would be a new beginning for the car companies. More for everyone. Well it was more for the CEO's and front office people who took the money and ran.
The unions who a lot of people distain are still there trying to get the most for their workers in a world that villifies anyone who would speak for the workers.
you have an overactive imagination about a lot of things, especially size.
chrysler is a dinosaur, and they CHOSE to be that way. even amonst elitist fascists they are idiots as car builders. they will always be someones tax writeoff, a pathetic waste of time and space for what was once a brand that had practical and solid things of offer.
no more. not ever.
Outsourcing of jobs to other countries has hollowed out our manufacturing
base.
If Germany can have a society of good wages and a social safety net and
still export products around the world then so can America.
A more useful statement would address how the administration plans to put the remaining 355,000 auto industry workers back to work, doing something productive and sustainable.
1) Chrysler is out of the woods,
2) the Chevy Volt will save GM
3) Ford has not taken any government bail-outs/handouts......
its just a product of the future
no the end all of gm
Chrysler Owner(s)
United Auto Workers Voluntary Employee Beneficiary Association (67.69%- paid nothing)
(Gave up pay and cuts in benefits and pensions for those shares.)
Fiat S.p.A. I don't know about the Fiat deal.
U.S. Government (9.85%- paid $6.6 billion)
(Collateral- Once solvent, Chrysler will buy those shares back at the market value resulting in a profit for us Tax Payers as for any share holder. GM is already gearing up for a new pubic offering on the stock exchange. Add to that the income tax and sales tax on production and sales add to federal and state treasury. Those employed are NOT collecting benefits and food stamps.)
Government of Canada (2.46%- paid $3.2 billion)
( Same as US. Collateral for loan, will sell back to Chrysler when company is profitable again )
Previous Stockholders (0.00%- paid many billions)
These people all still own their stocks unless they sold them. Only stock held by Chrysler was used for this deal because all other stocks were private property. When Chrysler is profitable again those stocks will rise as GM's already have. Saving the company saved all those individual shareholders investments )
The anger towards Obama and his administration is correctly targeted. What a empty suit sits in the Oval Office.
is that all ypu guys can do?
you complain about the unemploytment rate yet u complain we only saved union jobs
without the bankrupcy of the auto industry unemployment would be at 13 to 15 %
we would have devasated the manufacuring capability of the country
your just a complainer
Not to belabor the point, but for $6.6 billion in taxpayer money, what we got was less than 10% ownership of Chrysler. Too bad for Florida the swamp land doesn't vote solid Democratic.
Chrysler Owner(s)
United Auto Workers Voluntary Employee Beneficiary Association (67.69%- paid nothing)
Fiat S.p.A. (20%- paid nothing)
U.S. Government (9.85%- paid $6.6 billion)
Government of Canada (2.46%- paid $3.2 billion)
Previous Stockholders (0.00%- paid many billions)
I'm wondering if even the UAW workers would have just taken the cash instead.