Coming to grips with unemployment
Just two weeks ago 3,400 members of the United Automobile Workers union were turning out 720 Chevrolet Celebrities and Pontiac 6,000s a day here at New England's only General Motors assembly plant. Now the tables have turned: the workers are about all that are coming off the plant lines.
Last week, the final new-model car was completed. The workers have been let go indefinitely, except for 200 who will stay on another week to ship the remaining inventory and prepare the plant for shutdown. About 500 office workers will also stay on, though GM officials don't know for how long.
This addition to the numbers of America's unemployed came too late to be included in September's unemployment rate of 10.1 percent, a record since 1940. Some of these workers - especially ones with seniority - will be better off than many other unemployed blue-collar workers across the country because of UAW benefits. As Charles McDevitt, the president of UAW Local 422, put it:
''Thank goodness our leadership prepared for this kind of thing.''
On the other hand, about 500 of the unemployed workers have been working at the plant for five years or less. They can expect almost no benefits from the UAW. Many have mortgages, car payments, and families to support.
''It's hard to think of scrubbing pots and pans for minimum wage when you've been making an average of $12 an hour,'' said one UAW worker. He had showed up for a casual ''seminar'' with AFL-CIO representatives in the tile-floored basement of Local 422. The officials were talking to workers about welfare, social security, food stamps, fuel assistance, and finding new jobs.
''Most union members don't understand the welfare system and are afraid or embarrassed by it,'' said Joe Quirk, an AFL-CIO representative at the meeting.
One option facing these workers is unemployment compensation - the maximum amount was pushed up on Oct. 1 from $156 a week to $172 a week; the rate of $6 per child per week still holds. The other option is a job - harder to find in this state where even some high-technology firms have imposed hiring freezes and most available jobs require skills.
Thus, these 500 or so jobless are typical of many others without work. Also typical is a nearby business, Anchor -Motor Freight Inc., which depends on the GM plant for its livelihood. Anchor Motor, a contractor for GM, delivers the plant's cars by truck to dealers across the country. By Friday, it will have let go 246 people.
But William Stevens, manager of Anchor Motor, says, ''We have to have a good attitude about the future. I am confident the auto industry will rebound and that the economy will come back.'' Until the plant reopens, Anchor Motor will rely on a small staff to move GM cars coming in by rail from other plants.
There seems to be agreement among many economists that the unemployment situation won't worsen much more. ''Unemployment is probably at, or very close to, the peak,'' says Wayne Ayers, vice-president and economist at the First National Bank of Boston. However, Mr. Ayers does not predict the figure will drop much below 9 percent next year - even with the expected recovery. ''Unemployment is very quick to move up, and slow to move down. Firms want to be very sure the recovery is there in earnest before they begin employing,'' he said.
September's 10.1 percent figure still reflects layoffs ''mostly in durable-goods manufacturing,'' says Michelle Brandon, an economist with Chase Econometrics. Other sectors, such as service and high-technology industries, are in a financial bind but aren't yet experiencing large-scale layoffs, she says.
The GM plant in Framingham was shut down in January and February this year and numerous weeks throughout the summer. Some laid-off workers predict the plant will reopen in February. Some say they think that whenever it reopens, it will operate with one shift of workers instead of two. However, there are already two other GM plants that produce the Celebrity and the 6000 (both just introduced last January), and there are no immediate plans to retool the factory.
The reason for the closing of the plant ''is strictly a sales problem,'' says plant spokesman George Robinson. The $8,000 base-priced cars, though ''top-quality, beautiful cars'' according to workers, simply are not moving. Says John Vieira, a worker at the plant for 19 years, ''It's high interest rates that are keeping people from buying these cars.''
All across the country, UAW workers chip in $1.23 per hour of work toward a supplemental unemployment benefit fund (SUB). Laid-off UAW workers draw on the fund. Together with unemployment compensation, the SUB accounts for 75 percent of a worker's former wages. It used to account for 95 percent, but with fewer employed workers contributing to the fund, there is less to go around.
During the course of intermittent layoffs last summer, most workers with under five years' seniority used up accumulated SUB funds. One former worker, a spot welder for five years at the plant, said he has eight weeks of SUB left. For now he plans to borrow from friends.
''I can't borrow from relatives because my dad and brother-in-law both worked at the plant,'' he said. His savings ($800) were used up recently by a family emergency. ''With the summer layoffs, most people thought this would happen, and saved - but things come up,'' he shrugged.