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By Bernard Simon in Toronto
Financial Times
Updated: 11:41 p.m. ET Dec 5, 2006
A car assembly line may seem a world away from the CIA or the US Secret Service. Still, some Ford Motor workers are pondering just such a jump after taking early retirement and severance packages from the troubled carmaker.
The CIA and the Secret Service were among dozens of exhibitors at "opportunity fairs" that Ford organized at its US plants in recent months to give workers an idea of what might lie ahead if they decided to move on.
Ford revealed last week that 38,000 workers, or close to half its US blue-collar workforce, had accepted the buyouts. Another 34,000 will leave General Motors under a similar scheme. Among parts suppliers, Delphi will lose over 20,000. Thousands of salaried workers are also set to leave the industry.
Economists, sociologists and personnel managers are watching what choices the workers make, and how their lives subsequently unfold. One economist describes the exodus as a giant "natural experiment".
The University of Michigan's school of management, which helped Ford design its severance packages, thinks its experience could hold valuable lessons for other companies contemplating mass buyouts. The university has collected data from surveys and focus groups involving 2,000 workers.
The research shows the Ford workers were less swayed by information and advice provided by the company than by family and friends, outside financial advisers and union representatives.
Kim Schatzel, a marketing professor who led the study, adds that female workers generally investigated their options more thoroughly than men.
A large chunk of those leaving are likely to stop working altogether. Eighty-seven per cent of the GM workers are covered by retirement packages, guaranteeing them a pension and continuing healthcare benefits. Many are likely to head for the warmth of Florida and Arizona.
Many younger workers are also expected to move away from the US car industry's heartland in Michigan, Ohio and Indiana. Michigan has the highest jobless rate in the US. Ms Schatzel's research suggests that women are less likely to relocate than men.
Union Pacific, the Nebraska-based railway company, also set up recruiting booths at the Ford jobs fair. But none of its operations is in Michigan.
Union Pacific wants to recruit train inspectors, conductors and diesel mechanics, among others, to replace ageing baby boomers in its workforce. As the company has openings in rural areas, it hopes to draw car workers looking for a family environment and who have hobbies such as hunting and fishing.
A spokesman said workers would find many similarities between an automotive plant and a railway, such as working with heavy equipment and a strong emphasis on safety.
Many other workers intend to further their education in preparation for fresh careers. Ford's buyout options included scholarships combined with partial wages and benefits.
Tom Ferguson, an electrician who spent 14 years at a Ford plant in Ohio, is now at Harvard pursuing a master's degree in business.
Under his buyout package, Mr Ferguson will receive half his wages and full benefits for the next four years as well as $15,000 a year towards tuition costs.
Michigan's state government hopes that subsidized training programs will help equip former car workers for jobs in less troubled industries, such as pharmaceuticals and computer services, that the state is trying to attract.
"If you're an electrician and were working on robotics on the assembly line, perhaps now you can work on medical equipment in the hospital", said Roland Zullo, a research scientist at the University of Michigan's Institute of Labor and Industrial Relations.
One fear is that some workers will fritter their payouts on risky businesses, especially franchises. Little Caesars Pizza and Fantastic Sams, a hair-care chain, were among those seeking franchisees at Ford's job fairs.
http://www.msnbc.msn.com/id/16060130/
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