The New York Times reports that many companies are increasing their bottom lines -- but aren't going to be recalling laid off workers anytime soon. Companies Find Surging Profits in Deeper Cuts. That's because companies know that they can get away with making people work more without paying more. Exhibit A is Harley Davidson, where the company reported a 71 million dollar profit last quarter, triple from the year before. Despite the profit, none of the 2,000 jobs cut last year are coming back.
Harley perfected a method of collective bargaining that companies have been using since the recession started: threaten to move jobs to other states, or countries, unless workers agree to draconian wage cuts, benefit cuts, and work rules. In this climate of fear, many workers agreed. Employees aren't stupid though; when they see reports of record profits at a time when they have been asked to sacrifice, they are resentful and unhappy.
There is no doubt that many companies have had to restructure and have legitimately reined in labor costs in order to survive. There are many more, however, that have used the recession to get what they always wanted but couldn't when the economy was better. But Henry Ford recognized long ago that unless people have money, they can't buy a company's products. When other companies follow Harley's lead and layoff workers in order to maximize profits, they are creating an America in which people can't afford to buy an expensive motorcycle. And without more consumption, the economy will continue to lag.
No comments:
Post a Comment