Factory Jobs Gain, but Wages Retreat

LOUISVILLE, Ky. - Manufacturers are hiring again in America, softening a long slide in factory employment. But for a new generation of blue-collar workers, even those protected by unions, the price of employment is likely to be lower wages stretching to retirement.

That is particularly true of global manufacturers like General Electric. With labor costs moving down at its appliance factories here, the company is bringing home the production of water heaters as well as some refrigerators, and expanding its work force to do so.

The wages for the new hires, however, are $10 to $15 an hour less than the pay scale for hourly employees already on staff - with the additional concession that the newcomers will not catch up for the foreseeable future. Such union-endorsed contracts are also showing up in the auto industry, at steel and tire companies, and at manufacturers of farm implements and other heavy equipment, according to Gordon Pavy, president of the Labor and Employment Relations Association and, until recently, the A.F.L.-C.I.O.'s director of collective bargaining.

"Some companies want to keep work here, or bring it back from Asia," Mr. Pavy said, "but in order to do that they have to be competitive in the final prices of their products, and one way to be competitive is to lower the compensation of their American workers."

The shrunken pay scale for newcomers - $12 to $19 an hour versus $21 to $32 an hour for longtime workers - threatens to undo the middle-class status of even the best-paid blue-collar jobs still left in manufacturing. A similar contract limits the wages of new hires at a nearby Ford Motor Company stamping plant, but neither G.E.'s 2,000 hourly workers nor Ford's 2,900, nor their unions nor the mayor, Greg Fischer, have objected.

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