The announcement that a German company
is opening a small manufacturing facility in Wisconsin brings up a question that just a few years ago would have been unthinkable:
Is this another case of a European company coming to the United States for the cheap labor?
As contrary to the stature we're accustomed to the United States having in the world, this is a very real trend. Ikea, a company that has done just fine in Sweden with strong unions and a $19 minimum wage, came to Virginia and started its employees at $8 per hour, with many of them temps at lower wages and no benefits. T-Mobile, owned by a heavily unionized German company, fights unions here. BMW recently drove down wages by laying off unionized workers at a California distribution center and outsourcing their jobs to a subcontractor. But in South Carolina, BMW skipped ever having a union, paying its workers $15 an hour, half what German BMW workers make. The kicker:
"We are a low-wage country compared to Germany," said Kristin Dziczek, director of the Labor and Industry Group at the Center for Automotive Research. "And that helps put jobs here."
The jury is still out on the jobs coming into Wisconsin; they're being billed as "desirable" and "good family supporting" jobs by the mayor of Brookfield, Wisconsin, but those $15 BMW jobs in South Carolina drew applicants who had previously been managers and supervisors of large construction projects and distribution centers. The standard for a desirable job, in other words, has deteriorated somewhat in the United States. Oh, and Wisconsin is projected to get just 27 new jobs by 2015 from this deal, for which the state provided tax credits.
We worry about American jobs going overseas to lower-wage countries. But in the mean time, we're becoming the low-wage country that Germany and Sweden send jobs to—jobs Americans line up to take and feel lucky to get.