Average Hourly Wage and Benefits:
All: "Labor Talks Between UAW, GM Resume," USA Today, Sep. 17, 2007
GM: "Other Benefits," Media Handbook, available at
www.media.gm.com/manufacturing/handbook (accessed Nov. 30, 3008); GM explained the calculation for its total compensation and benefits in its Media Handbook:
"The total of both cash compensation and benefits provided to GM hourly workers in 2006 amounted to approximately $73.26 per active hour worked. This total is made of two main components: cash compensation ($39.68) and benefit/government required programs ($33.58).
The average annual cash compensation for hourly employees in 2006 was $39.68 per hour. Included in average earnings are straight-time pay, Cost of Living Allowance (COLA), night-shift premiums, overtime premiums, holiday and vacation pay. In 2003, GM workers logged 41,363 (hours in 000’s) in overtime hours for an average of 371 hours per worker; in 2004, 39,409 overtime hours for an average of 374 hours per worker; in 2005, 33,555 overtime hours for an average of 337 hours per worker; and in 2006, 27,265 overtime hours for an average of 315 hours per worker.
Benefit/government required programs in 2006 added an additional $33.58 for each active hour worked. These costs include: group life insurance, disability benefits, and Supplemental Unemployment Benefits (SUB), Job Security (JOBS), pensions, unemployment compensation, Social Security taxes, and hospital, surgical, prescription drug, dental, and vision care benefits."
Ford: "Hourly Labor Cost," 2007 UAW-Ford National Negotiations Media Fact Book, available at
http://media.ford.com/pdf/07_UAW_Negotiations.pdf (accessed Dec. 10, 2008); Ford explained the factors in its calculation of the cost of labor:
"Labor costs can be defined and measured in a number of ways. One of the most meaningful measures is the total average hourly cost to the company per hour worked. This includes: (1) all the dollars paid to employees, (2) the cost of contractual benefits for employees, and (3) the cost of statutory payments, such as Social Security and Workers' Compensation – all calculated on the basis of hours worked by employees...
[D]uring the 1997-2006 period, Ford's total average hourly cost per hour worked increased 62%, from $43.55 to $70.51."
The UAW offered a different estimate of wages in a Dec 2, 2008 document on its website titled "The Truth About UAW Members and the U.S. Auto Industry":
"Wages for UAW members at Chrysler, Ford and GM range from about $14 an hour for newly hired workers to $28 an hour for assemblers to $33 for skilled trades workers.Typical hourly wages at Honda, Nissan and Toyota are only slightly lower...
The $73 an hour figure is outdated and inaccurate. It includes not only the costs of health care, pensions, and other compensation for current workers, but also the costs of the pensions and health care benefits of retired employees spread out over the active workers. Active workers never receive any of this compensation in any form, so it is not accurate to describe it as part of their 'earnings.'"
"$73 an Hour: Adding It Up," New York Times, Dec. 9, 2008:
"The calculations show, accurately enough, that for every hour a unionized worker puts in, one of the Big Three really does spend about $73 on compensation. So the number isn’t made up. But it is the combination of three very different categories.
The first category is simply cash payments, which is what many people imagine when they hear the word 'compensation.' It includes wages, overtime and vacation pay, and comes to about $40 an hour. (The numbers vary a bit by company and year. That’s why $73 is sometimes $70 or $77.)
The second category is fringe benefits, like health insurance and pensions. These benefits have real value, even if they don’t show up on a weekly paycheck. At the Big Three, the benefits amount to $15 an hour or so.
Add the two together, and you get the true hourly compensation of Detroit's unionized work force: roughly $55 an hour. It’s a little more than twice as much as the typical American worker makes, benefits included. The more relevant comparison, though, is probably to Honda’s or Toyota's (nonunionized) workers. They make in the neighborhood of $45 an hour, and most of the gap stems from their less generous benefits.
The third category is the cost of benefits for retirees. These are essentially fixed costs that have no relation to how many vehicles the companies make. But they are a real cost, so the companies add them into the mix -- dividing those costs by the total hours of the current work force, to get a figure of $15 or so -- and end up at roughly $70 an hour."
