In Detroit, Two Wage Levels Are the New Way of Work
DETROIT — They are a cornerstone of Chrysler’s unlikely comeback: 900 employees turning out a Jeep Grand Cherokee S.U.V. every 48 seconds of the working day at an assembly plant here.
Nothing distinguishes them from the other workers at the Jefferson North plant, except their paychecks.
The newest Chrysler workers earn about $14 an hour, compared with double that amount for longtime employees on the same shift. With the economy slumping and job creation once again a pressing issue in the White House and Congress, the advent of a two-tier wage system in Detroit is spiking employment for one of the country’s most important manufacturing industries.
For many, the opportunity for steady employment is welcome, even at a lower wage.
‘Everybody is appreciative of a job and glad to be working,’ said Derrick Chatman, who makes $14.65 an hour putting tires on Jeeps after being laid off at Home Depot, working odd construction jobs and collecting unemployment.
What was once seen as a desperate move to prop up the struggling auto industry is now considered an integral part of its future. The demand for $14-an-hour manufacturing jobs is providing Detroit’s Big Three automakers with a ready pool of eager new employees. Last year, Chrysler was flooded with inquiries about the jobs here, and it froze the list after receiving 10,000 applications.
The companies say the two-tier wages are paying off. Despite the disparity, there is no appreciable difference in the Grand Cherokees produced on the shift dominated since last fall by the lower-paid workers, the plant manager says. At General Motors, the savings from its two-tier workers are crucial to production that began last month of an inexpensive, subcompact car, the Chevrolet Sonic, in suburban Detroit.
Two-tier wage systems have been tried in the airline industry and others with spotty success. Usually the lower wages disappear rather quickly when the economy picks up. But the arrival of vastly different wage rates in auto factories is a seminal event in an industry long influenced by a powerful union devoted to equal pay regardless of seniority.
The new jobs, which are seen as long term, are being watched closely by economists, executives in other industries and Washington policy makers eager to increase employment in manufacturing and other areas.
