[Peace-discuss] Hard Times In Decatur

[David Green]

TRIBUNE SPECIAL REPORT
Will work for less
'It used to be a good job, now it's just a job'

By Stephen Franklin
Tribune staff reporter
Published January 22, 2006

DECATUR, Ill. -- Whenever Robert Johnson puts in
12-hour shifts, which is often because he needs the
money, he knows he should grab a bite in the factory
lunchroom because he's a diabetic.

But he rarely does because a slice of pizza at the
Caterpillar plant costs nearly $3, and that's beyond
his means.

Glued to a bare-bones budget, he saved for weeks to
buy a five-pack of $7 T-shirts. Sunday visits with his
kids, 53 miles away in Springfield, are out of the
question if he doesn't have gas money.

He didn't always live this way.

Six years ago Johnson was earning more than twice as
much money--$29 an hour--at a nuclear power plant in
nearby Clinton. Then he got laid off and tumbled into
an underworld of low wages and slimmed-down benefits.

This underworld is now the reality, or a disheartening
look into the near future, for thousands of workers as
the industrial Midwest undergoes the most wrenching
economic transformation since the bad old Rust Belt
days of the 1970s.

With the forces of globalization leading companies to
slash costs, move out of the country or go under,
workers who don't bring a clear competitive advantage
to work every day are vulnerable to having their pay
cut.

At this moment the risk is clearest in the auto parts
industry, where Delphi Corp. has filed for bankruptcy
court protection, and its chairman, Robert "Steve"
Miller, has threatened to cut wages from $27 an hour
to as low as $9.50.

But look at any number of industries where American
factory hands are competing against the Chinese or the
Cambodians, whether in textiles or furniture or
appliances, and the fallout is the same: The standard
of living for the Americans slips.

"For the United States, it's the end of labor as we
once knew it," Stephen Roach, chief economist at
Morgan Stanley, wrote recently.

A version of this new reality is taking place in
Decatur, where Caterpillar Inc. introduced hundreds of
new hires last year. Job creation was the good news.
The bad news: Starting wages were cut to $10 an hour
from $20.

The result is that Caterpillar and Decatur have become
a laboratory of sorts for witnessing the impact of
wage cuts. Working and living side by side are
Caterpillar employees doing the same kind of work for
different wages. The lucky ones are paid according to
the old scale.

The unlucky ones are struggling, like Johnson, who got
his $12.24-an-hour Caterpillar job in January 2005. It
was days before he was due to start work for $7 an
hour at a Target store in Decatur.

The new job has hardly lifted him up financially.

"I live on just the bare necessities," he said one day
recently in his one-bedroom apartment, a small, darkly
lit place with nearly empty walls. He pays $385
monthly rent for the cheapest place in town that he
thought he could live in.

Growing up in Decatur, he expected factory work to pay
off for him as it did for his father, a Caterpillar
engineer, and for neighbors who earned very decent
wages as blue-collar workers at the many factories
scattered around town.

Indeed, while Decatur lost nearly half of its factory
jobs in the last 25 years, there are survivors who are
reminders of how the old system used to work.

Kent Smith started at Caterpillar's Decatur plant 31
years ago when he was 22 years old. For years Smith
didn't like the job. It was boring and dirty. But he
stayed because of the pay, the pension and benefits
that were hard to find elsewhere.

Until last year, Caterpillar picked up nearly all of
his health-care costs, a financial boost that's almost
extinct among companies today. Now Smith has to pay
for his premiums, with out-of-pocket costs growing
yearly.

But he earns just over $25 an hour as an electrician.
With his Caterpillar job and his wife's salary as a
manager for the local telephone company, he has done
well financially.

Smith lives in a two-story wood-frame house set amid
10 acres of hickory, oak and ash trees just outside
Shelbyville, south of Decatur. He has a tree-shaded
13-foot-deep pond stocked with fish. He also has a
Harley-Davidson motorcycle and a snowmobile.

Smith doesn't talk about his lifestyle with new hires
at work because "I try not to rub their noses in it."
He is a reserved person, but he has no hesitation in
sharing his thoughts on what's happened at factories
like his.

"Corporations want the American worker to tread water
or sink so other workers around the world can catch up
with us," he said. So, too, it strikes him that a job
at Caterpillar "used to be a good job, but now it's
just a job."

Caterpillar won't say how many new workers it has
hired at the new lower wages, but union officials say
it is 1,400.

Dave Stanley, president of UAW Local 751 in Decatur,
remembers Caterpillar's warning to union officials
during the last round of negotiations, and the feeling
that the union's back was against the wall.

"They said that if the contract were not approved, the
plants would die on the vine," he recalled. The union
fought Caterpillar for 6 1/2 years in the 1990s over
the wage tiers and other concessions that it
ultimately accepted.

Stanley said Caterpillar has handed out hefty raises
since last year in order to hold on to higher-skilled
workers, but it has not done the same for those with
lower skills, who are the bulk of the workers in
Decatur.

He wonders how the new workers will support their
families on the lowered wages.

Caterpillar spokeswoman Linda Fairbanks said the
company was simply fitting the mold when it reduced
pay.

"Our wage and benefit package is competitive in the
local market," she said, adding that the company
relied on a vast array of data.

`It's the best I can find'

Don Dragovan was thrilled when Caterpillar hired him
more than a year ago. He thought he had signed up for
the blue-collar gravy train in his early 50s.
Neighbors congratulated him.

At the time, Dragovan was working three jobs: one as a
part-time psychology professor, one as a painter and
another doing whatever side job he could find. It was
hardly ideal for someone who had suffered a heart
attack a few years before.

His dream didn't totally come true at Caterpillar. He
was put on the lower pay tier and today earns about
$15 an hour as a painter. He is disappointed. But only
slightly.

"The reality is this: It's the best that I can find.
Now I have a full-time job, not three, and I have
health care. I didn't have that [health care] before,"
he said.

Dragovan figures the company's health-care plan has
covered more than $30,000 in medical bills for his
family in the last year.

The problem is, he still can't get by. Not with two
kids in college and another headed that way next year.

That means he recently paid $357 for new brakes for a
car with more than 150,000 miles, when he had been
thinking about buying a new one. It means buying
day-old items at supermarkets and bargains like the
$1.15 loaf of bread he picked up the day before. It
means soon dropping his telephone line and depending
on his cell phone. It means looking for a second job
--again.

"It's a constant question of `do we really need
this,'" he said.

To save money, he relies on a small space heater. It
is usually enough to heat the small, three-bedroom
house he bought for $37,000 in 1993.

At work, he will hear other new hires boasting that
they will do only 60 percent of the job because that's
what they are getting paid. He doesn't agree with that
kind of thinking.

But there are times when he sees veteran workers not
putting out as much as he does, and it clicks that
they are making $17,000 more a year for the same work.
Such times he wants to remind them how good they have
it.

Second-class citizen

Johnson, a quiet, soft-spoken man in his late 40s, has
similar thoughts on the job.

Every so often he would like to tell the new hires,
who last worked at a fast-food place and who are
starry-eyed over the 12-bucks-an-hour pay scale, that
their jobs are not stepping stones unless they get
more education.

But he also would like to explain to his young,
recently hired bosses--college graduates who regularly
tell him that he won't go anywhere without a
degree--that they make him feel like a second-class
citizen when they say such things.

Johnson wishes they would realize that he has learned
things from working in a factory that years of college
studies wouldn't give him.

He never wanted to work in an office, which is why he
didn't mind going to work years ago at the Illinois
Power Co. nuclear plant in Clinton. Likewise, when he
was laid off in 1999, he didn't consider retraining
because he wasn't sure what he would do. He thought he
would keep doing factory work.

He knew that factory work had changed. But he didn't
realize how much wages had declined.

"Ten years ago, many factory workers were making very
decent wages. But I don't think we'll see that again,"
said Robyn McCoy, head of the federally funded
Workforce Investment Solutions office in Decatur. It
handles job training for laid-off workers in the area.

Such a fact of life matters greatly in Midwest
communities like Decatur, which were nurtured by
well-paying factory jobs for people who showed up for
work with little more than two strong arms and a
willingness to put in a hard day.

A learning experience

As Johnson climbed down the pay scale, he shed his
middle-class goodies: a large, comfortable house in
Lincoln, a new car and a pickup and a racetrack car he
dabbled with. He is still paying for the two cars that
were seized by creditors.

He pays $285 every other week in support for his three
children. That leaves him $516 to spend every two
weeks. His monthly rent is $385. He pays $215 monthly
for his 2001 Chevy Lumina. He has the minimum car
insurance, $30 a month. Food costs $150 a month.

The last movie he saw was shown at a church before
Christmas. His parents bought him the ticket.

Without the overtime he works--as much as he can
get--he would not be able to pay for his doctor visits
or medicine.

Still, he was surprised recently, he said, when he
went to pick up prescriptions that cost $104. He had
to return home for more cash and later had to pinch
money from other expenses.

But one morning recently, as he got ready for work, he
was feeling upbeat about his future and stoic about
his losses. He talked about moving on, making the best
of things, learning to start over.

"It's been a learning experience. It shows me I can do
things I once didn't want to do. ... You just have to
keep a positive attitude. But a lot of people are
giving up," he said. "The way things are, you know you
have to take it as you get it."

"Cat," the young cat he picked up recently, bounced
around the apartment, keeping him busy. "Cat" costs
money, but she keeps him company, he said.

In time, Johnson said, his pay will go up, or maybe he
will get a better-paying job.

"We're in a cycle right now where corporations have
the advantage, and unions don't," he said. "But soon
the cycle will change."

----------

sfranklin at tribune.com

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chicagotribune.com/brokenheartland 
Copyright © 2006, Chicago Tribune 



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