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Articles About labor costs
What can be done about the rising cost of labor? Mr. Robert Reich, U.S. Secretary of Labor, has already indicated the administration's intention of pushing the minimum wage from $4.25 to $4.50 per hour and indexing it for inflation. That means that every jiggle in the inflation chart will push the minimum wage higher.
A fundamental characteristic of the gear industry is that it is capital intensive. In the last decade, the gear manufacturing industry has been undergoing an intense drive toward improving and modernizing its capital equipment base. The Department of Commerce reports that annual sales of gear cutting equipment have increased nearly 60% since 1990. While this effort has paid off in increased competitiveness for the American gear industry, it is important to remember that there is another capital crucial to manufacturing success - "human capital."
the gear industry is awash in manufacturing technologies that promise to eliminate waste by producing gears in near-net shape, cut production and labor costs and permit gear designers greater freedom in materials. These methods can be broken down into the following categories: alternative ways to cut, alternative ways to form and new, exotic alternatives. Some are new, some are old and some are simply amazing.
Getting and keeping a work force capable of meeting the demands of the 21st century is one of the key challenges most U.S. manufacturers face today. That's not even news anymore. I - and others - have been talking about it in editorials and speeches for ten years now. It's also not news that the job is a tough one and that industry-wide response often has not been particularly effective.
It wasn’t so very long ago that a high school-educated, able-bodied person with a will to work typically had little trouble finding a decent job in manufacturing. Whether at an area job shop, an OEM plant or auto plant—work was to be had. Work that paid well enough to marry, buy a home, feed, raise and educate a family—with even enough left over for a modest retirement pension.
"More than half our young people leave school without the knowledge or foundation required to find and hold a job." according to a 1991 report from the U.S. Dept. of Labor. A huge gap exists between the needs of employers (especially in manufacturing) and the training received by most high school students.
The passage last year of both NAFTA and GATT has gone a long way toward leveling the playing field for American manufacturers and other hoping to compete in the global economy. Add to this news the fact that the domestic economy keeps growing, and it seems as though good times are ahead for the gear industry.
Faithful Addendum readers are accustomed to finding upbeat, whimsical and oddball stories about gears in this space. What follows is not about gears, exactly. Rather, it is, as opposed to the usual bleak news about America losing its manufacturing mojo—a look at a positive, hopeful development in that regard.
For years, politicians, educators and business leaders have generated various ideas to revitalize U.S. manufacturing and engineering. These include manufacturing initiatives, internal training programs and an emphasis on science, technology, engineering and mathematics (STEM) in the classroom. The declining expertise in these fields, however, continues to be a growing problem in every facet of manufacturing and engineering.
We asked Fred Young, president of Forest City Gear Co., to answer some of the gear industry's burning questions.
Lack of skilled workers mirrors U.S. manufacturing's decline.
Popular wisdom has it that manufacturing in the United States is no longer a viable entity. We are told that quality is poor, skilled labor is difficult to obtain, if not impossible, demand is low, and the government is helping to discourage business. So what should we do, give up?