U.S Auto Parts industry struggles to gather people in Corona to recover Demand

Millions of people have lost their jobs in the United States due to the new coronavirus. But the US automotive industry is now struggling to secure enough people on the production line for suppliers. They rely on measures such as giving rewards when attendance is good and assigning teachers to the workplace to attract job vacancies with children.

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General Motors (GM) GM.N , Ford Motor FN and others are customer engineering and machinery manufacturers, and Joe Perkins, CEO of Movex Global, has over time employees to meet growing demand. I’m increasing. They are increasing salaries and offering bonuses to recruit 80 people from 12 domestic factories. “This is our most serious problem,” he said.

According to Perkins, he uses about 10 recruitment agencies and uses a number of job search sites such as LinkedIn. Job-seeking information is also posted on the local news broadcasting station, and a bill is placed on the lawn of the residential area. He says he is working hard to recruit local newspapers, billboards, public transport and church newsletters.


The US auto industry is usually the first to be hit by the downturn and the slowest recovery. However, the new corona virus is different. Demand for new cars is already recovering, but industry executives say the unemployment rate in the United States is still high amid concerns about infection and the inability of many workers to leave home due to child care. Nevertheless, some managers are forced to raise their wages.

According to Brian Collie of the Boston Consulting Group, many suppliers in the automotive industry are currently absent from 10-15% of the workforce needed. This has given automakers less discretion to hire temporary workers, according to United Auto Workers (UAW) executives.

The CEO, a manufacturer of fuel systems and emissions reduction systems under the umbrella of Plastic Omnium, an automobile exterior component, says it is rewarding employees with good attendance.

The production suspension measures associated with the new Corona have hit the profits of suppliers as in the automobile industry. Supplier is now forced to raise wages to attract workers and increase overtime to meet delivery demand, resulting in additional burdens.

According to the Bureau of Labor Statistics, the average hourly wage in the automobile sector in September rose to $ 28.21, surpassing $ 27.65 in July. It is higher than $ 27.57 in September of the previous year. The average weekly overtime hours of auto parts factories was 4.3 hours in August, exceeding 3.8 hours in January and February respectively.


“The number one topic is wages,” said Dan Dan Spalone, vice president of recruitment brokerage Adecco. Some factories have raised their hourly wages by as much as $ 5, he said.

Smaller suppliers are under greater pressure because wages are lower than those of larger and automakers, according to auto industry executives.

The US unemployment rate in September’s employment statistics was 7.9%, but according to the Statistics Bureau, people who have jobs but are not able to go to work may have answered the survey incorrectly and are working. It is estimated that the actual number of people without them was 8.3%. However, looking at the durable goods sector alone, the unemployment rate in the same month was 5.7%.

A total of about 85,000 people were unemployed in the Indiana manufacturing industry in March and April, but by the end of August, about 51,000 people were re-employed and manufacturing employment recovered to about 501,000. Employment in the Michigan automotive sector has almost halved with the new Corona, reaching a peak of about 96,000 in April, but recovered 71% from here to the end of August.

According to consultancy AlixPartners Dan Heelsch, a laser equipment company in the suburbs of Detroit has turned the vocational training room into an online lesson space for children to make it easier for employees who have to take care of their children to go to work. I also hired a teacher to help me study.

Some managers adjust shifts to minimize overtime for employees, he said. James Sheehan, CEO of North America, who manufactures car chassis and car bodies, said, “In the end, I will overtime, but I hate it and quit. I have to hire new employees.” The company also offers special allowances of up to $ 2,000 for employees who help hire and referrals. Approved referral fees of up to $ 4,000 for hiring talented temporary employees.

“Suppliers are afraid of the upcoming flu season, because they are already understaffed,” said Melissa Hassett, vice president of Man power Group.

Source Reuters

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