Factory workers quitting in droves

Published 1:47 pm Wednesday, August 16, 2017

INDIANAPOLIS — Kipp Glenn grew tired of standing for eight-hour shifts, assembling steel furnace doors. His knees ached from 25 years on the concrete factory floor. So even after President Donald Trump made his job at Carrier a symbol of American prosperity and vowed to save it, the Indiana native took a buyout.

“What we want to call ‘blue-collar jobs’ are on the way out,” he said.

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At a time when the Trump administration argues that creating manufacturing jobs is a critical national goal — even coordinating with states on generous subsidy packages to woo blue-collar employers — many factory workers are making a surprising decision: They’re quitting.

Government data shows workers in the sector are giving up their jobs at the fastest pace in a decade. That’s a powerful sign, economists say, that workers think they can find work elsewhere.

Part of this confidence stems from the nation’s 4.3 percent unemployment rate, a 16-year low. But they say they also fear robots zapping jobs in the future, while many workers have tucked away savings from union-championed raises and retirement benefits.

Leaving steady work, of course, carries risks, and some who quit may elect to stay in the field. As Trump and other politicians have argued, manufacturing pay has historically provided higher wages and more benefits than other types of blue-collar work. And there is no guarantee that these workers, who often possess just a high school diploma, will not encounter new challenges in an economy that favors those with more education. Many others who have been forced out of the industry over the past 20 years because of increased automation and outsourcing have struggled to find equally rewarding work.

Still, analysts say, the increase of people departing reflects a healthy adjustment in an industry that is likely to shrink as technology advances.

“It’s not this apocalyptic scenario that a lot of people make it out to be,” said Michael R. Strain, director of economic policy studies at the American Enterprise Institute, a right-leaning Washington think tank. “We shouldn’t be talking about these workers like they’re helpless.”

Carrier came to the nation’s attention last year when Trump excoriated it for sending jobs to Mexico. The company ultimately agreed to preserve some jobs, thanks to a deal with the state government in Indiana — worked out with the Trump team — but some layoffs were still permitted to move forward.

Nearly half of the 337 employees who left Carrier on July 20 in a wave of planned job reductions did so willingly, citing a belief that automation threatened their job security and that they could find or make better work. They also seized a severance package that included a week of pay for every year at the company.

Since Trump declared his candidacy, more factory workers have left their jobs than have been laid off or fired, according to data from the Bureau of Labor Statistics. The share of employees voluntarily leaving the industry has climbed from 1.1 percent to 1.6 percent since June 2015. (During that period, the broader economy’s quitting rate barely budged, from 2 percent to 2.1 percent.)

That translates to a hefty pile of resignations. In June, the most recent month of data available, 194,000 factory workers quit their jobs, while 29,000 retired and 101,000 were dismissed.

Analysts cannot say whether the employees are fleeing for better paychecks, hopping to another assembly line or exiting the workforce entirely. Overall, manufacturing employment has been growing slowly.

Of those who left jobs at Carrier, one worker took the buyout last month to launch his own concierge business. Another chose to focus on his homemade talk show. Another aims to work as a caregiver, placing her faith in lottery tickets.

And Glenn, 53, is going back to school.

“I didn’t want to suffer another 15 years in there,” he said.

Glenn said he noticed robots creeping into the plant about 18 months ago. A blue-and-gray machine bumped him to another spot in the factory, he said, which pushed a younger employee into a lower-paid role. (Carrier did not comment on the factory’s technological changes.)

“We would have to be ignorant to look away from automation,” he said. “It’s taking things over.”

He took advantage of the company’s education benefits to study psychology online at Virginia’s Liberty University. Glenn, who also works as a pastor, loves coaching people through life’s problems – marital spats, anxiety about the future – and said he feels especially attuned to fears that commonly arise on the factory floor.

“It’s scary for a blue-collar worker today,” he said. “Some of us feel like we’re too old to go back into the educational realm, to learn anything new, and yet too young to retire. I want to help them.”

The United States has shed about 5 million manufacturing jobs over the past two decades. Trump campaigned to reverse the trend, blaming the job losses on trade deals with Mexico and China.

In an early sign of his economic priorities as president, he visited the Carrier plant in December and claimed to have persuaded the company to keep jobs in the United States rather than send them to Mexico.

The president took credit for another manufacturing deal last month, telling reporters at the White House that he had met with Foxconn executives in a bid to get the Taiwanese giant to build a new flat-screen-display factory in southeastern Wisconsin – a deal that relies on a $3 billion state incentives package.

Trump has said his efforts will restore the sector to its former glory, but Christian Zimmermann, an analyst at the Federal Reserve Bank of St. Louis, said the bigger picture is more complicated.

“People had the impression that manufacturing was shrinking because people were getting fired,” he said. “But there is a lot of churn going on. People are quitting to take other jobs.”

Charlotte Oslund, a statistician at BLS who follows employment changes, said these quitting workers might be costly for companies, but they’re a sign that people are chasing more-lucrative positions.

“You want to see a lot of quits, actually,” she said. “It’s a good thing for workers and the economy.”

In Indianapolis, where the unemployment rate rests at a tight 2.8 percent – significantly lower than the nation’s overall level – job seekers encounter “help wanted” signs on streets and billboards.

“We are hearing from employers all across different sectors who are struggling to find the talent they need,” said Angela Carr Klitzsch, chief executive of EmployIndy, an economic development group that helps train displaced workers.

Finding work that pays well with only a high school diploma, however, could prove challenging, Carr Klitzsch admitted. Median hourly pay for manufacturing workers in the United States is $26, while service roles can start at minimum wage.

T.J. Bray, a Carrier employee who is keeping his job, said he is grateful for his position at the factory, which allows him to support his 7-year-old son and 4-year-old daughter. His family just enjoyed a Florida vacation, he said.

“I applaud Mr. Trump for putting us in the national spotlight,” said Bray, 33. “I won’t be able to leave here and get on somewhere else making $26 an hour.”

Other Carrier workers say Trump’s mission to revive old-school manufacturing seems futile.

Andre Moore, who has logged nearly 13 years at the factory, said he never saw the president’s deal as permanent.

“What Trump actually did was bought more time,” he said. “The economy is phasing out these jobs. It’s not like it used to be, where my grandfather and uncle could actually retire.”

Moore, 44, took the buyout in July to expand his construction business — he specializes in decks and porches — and to create a concierge service, booking hotel rooms and cabs for business people who visit Indianapolis.

“If you’re not happy with what goes on,” Moore said, “you have to put yourself in a situation where you can succeed.”

Taj Longino, a 38-year-old who also quit Carrier last month, said he wants to turn his radio show from a passion project to a moneymaker. He spent 13 years at the company, putting together furnace parts by day while interviewing celebrities about marriage and politics in his spare time.

“The minute they offered the severance package, it was a no-brainer for me,” Longino said. “I needed to free up time to pursue what I wanted to do.”

He runs “The Taj Longino Show” out of his house, broadcasting it online with equipment he bought and help from a crew of friends. When musicians roll into town, he meets them at concert venues. His favorite interview so far, he said, was with the hip-hop group Bone Thugs-N-Harmony.

“We want to take the brand seriously until it’s generating income,” he said. “We’re trying to get that official sponsor.”

Brenda Battle, 55, also took the buyout in July after a quarter-century of working at Carrier.

She said she got lonely after a robot arrived, making her two-person job a one-person job. She disliked the absence of friendly chatter and named the machine after a five-letter expletive.

“That thing was scary,” she said.

Battle has savings and good luck with scratch-offs – one netted her $3,000 – and she recently made $900 in two hours at a nearby casino.

For extra cash, she wants to become a caretaker. She already does chores for her elderly father.

“It would be something that wouldn’t be strenuous,” she said. “Senior companions. I could take them to their doctors appointments. Grocery store. Fix them a meal.”

On her last day at Carrier, she beamed.

“Today was my day,” she said, sipping a Bud Light at a bar near the factory. “I had good times. I had bad times. But today, for me, was the best.”