GE Follows Toyota & Nissan To Exploit Michigan’s Strengths And Expose Michigan’s Glaring Weakness

by Jack Lifton on June 29, 2009

in Japan, News Analysis

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As reported recently, General Electric has decided to come to Michigan to employ out-of-work automotive manufacturing engineers and researchers at bargain prices. GE said that it was “looking for specialists in developing composites, machining, inspection, casting and coating technologies for its aviation and energy businesses. The auto industry employed many engineers with expertise in these areas.”

The Michigan mainstream media seems to believe this will bring jobs for the daily growing army of unemployed, low-skilled automotive workers, who haunt Michigan’s I-75 corridor between Detroit and Bay City; there are hundreds of thousands of such workers, with at most a high school education. Michigan has no aviation and little energy business. GE’s products would clearly be intended for other states and other countries, and few such businesses can be expected to come to Michigan to recruit low-skilled workers. Will GE pledge to only hire Americans and to build manufacturing plants in Michigan also?

Michigan is rapidly losing its OEM automotive industry engineering and manufacturing continuity. In desperation to cut costs over the last decade, the former Big Three pushed for their experienced engineers, the highest paid of course, due to seniority, to take early retirement so as to be replaced by younger lower-paid engineers.

Employees at all levels, except at the top, of course, were considered to be commodities – easily replaceable.

Nissan and Toyota were at first incredulous; they couldn’t believe that their American competitors could be so cavalier with the accumulated knowledge and skill at automotive engineering which the American companies had built over nearly a century of time.

But the Japanese and then the Koreans and the Chinese, soon learned by interviewing retired and laid-off automotive engineers, that the lack of interest in engineering continuity was a natural adjunct of the focus on short term profits, which dominated the American OEM automotive industry.

Japanese car companies, when a senior manager is retiring, remove him from any position where he might have knowledge of the company’s future planning, and instead place him in charge of training a group of subordinates, one of whom will replace him.

American OEM automotive companies simply let the senior manager go, and if they replace him, it may not even be with another insider, with the same skill set.

Both Nissan and Toyota already have large automotive engineering centers in Michigan, where they can obtain all of America’s OEM automotive engineering knowledge from world class automotive engineers, grateful to have a job where their skills are appreciated and their dignity is maintained.

GE sees Michigan’s talent pool of engineers and scientists as a rich fishing ground, but not for the future benefit of Michigan. To be fair, neither GE nor any Japanese company is going to build a manufacturing plant, in a state where they would be forced to take low-skilled UAW workers at above-average wages.

I hope that in 2010, Michigan’s voters will just dump the whole lot of its short-sighted elected officials and start all over again.

Michigan indeed has a rich pool of talented people. it’s just that none of Michigan’s elected officials, either at the state or national level, are among them.

A future Michigan governor should demand that Michigan employers seek out Michigan residents first, and the American citizens for jobs in Michigan. For every non-Michigan resident or foreign worker employed in Michigan, a company getting a tax break should lose 1% of that break.

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