Detroit auto workers do not make $73/hour.

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2008-12-10 17:16

Frank K
Colorado Springs, CO

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Media Matters has highlighted a major misconception floating around the mainstream media that the Detroit autoworkers make $73/hour. The $73/hour is a an all inclusive cost of labor if you throw in employee vacation and holiday pay, overtime premiums, pension contributions, group life insurance, disability benefits, unemployment compensation, Social Security taxes, and hospital, surgical, prescription drug, dental, and vision care benefits. It also includes the costs of pensions and health care for all of the retired workers and their spouses.

The truth is, base wages for UAW members range from about $14 per hour for newly hired workers to $28 per hour for assemblers.

While the merits of bailing out the auto industry are debated in Congress and the media, it would be nice if they checked their facts first.

2008-12-13 08:27

Frank K
Colorado Springs, CO

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Further to the wages of UAW union workers, the NY Times of December 9th has said that adding in overtime and vacation pay raises the average union worker's wage to about $40/hour. It would appear then that overtime and vacation pay must be a significant part of the compensation. The fringe benefits of employee health insurance and pensions (including the company costs for Social Security and Medicare payments) adds another $15/hour to the cost, while retiree benefits of pensions and health care add another $15/hour.

Ignoring the fixed retiree benefits, the NYT estimates that UAW salary plus benefits total $55/hour compared to the non-unionized $45/hour at Honda and Toyota. However, they also note that even if the UAW would cut their salaries and benefits to $45/hour, it would save only $800 on the cost of a Big 3 car. But the Big 3 are already selling their cars for an average of $2,500 less than the equivalent cars of Japanese companies.

Is the reason that the Big 3 are hurting the fault of the UAW Union? Or the Big 3 managment? Or the economic downturn which seems to have affected the Big 3 more than the Japanese automakers?

Unfortunately, a rational understanding of the problem is lost to TV viewers when the manistream media like CNN operate in ignorance and certain southern Republicans seek to exploit the crisis to "bust the unions" for politcal gain.

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