Sunday, December 14, 2008

US Senate kills auto industry bail out: point of clarification

In a previous post I said, "The US Senate refused to provide loans to the auto industry without the United Auto Workers making wage concessions".

Just to be clear, the UAW had already made concessions to the big three auto makers.

The union has agreed to self-fund some of it's previously negotiated benefits, as well as eliminating the Job Bank, which pays workers their full wages to not work.

Further, UAW workers do not make $70 per hour.

UAW workers, at the big three, cost $70 per hour if you include the costs of retirees and their benefits.

This would be the equivalent to calculating your salary as the amount you are paid plus the retirement benefits of those who worked in your industry previously.

The $70 per hour number came from the Heritage Foundation.

The Heritage Foundation, in their report
Auto Bailout Ignores Excessive Labor Costs, claims UAW workers earn $70 to $75 per hour, compared to an average private sector wage of $25.36, including benefits.

Although the wages are not public, it is believed assembly workers at non-union plants in the US earn salaries equivalent to UAW workers to make unionisation less attractive.

Related Links
Auto Bailout Ignores Excessive Labor Costs [The Heritage Foundation]
UAW agrees to suspend Jobs Bank, Gettelfinger says [Automotive News]
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