“Japanese auto companies opening plants in the Southern U.S. have been unfavorably surprised by the work force's poor level of training.“
So Toyota passed up the usual hefty financial bribes from Southern states and instead chose to locate its new plant in Canada, where wages may be higher but employees are both better educated and healthier.
Here in Tennessee, we like to point to Mississippi and say ‘at least we’re not that uneducated and that unhealthy.’ But we can only just barely get away with saying that. Last year the local paper ran a front page story citing a study that found that all of 53% of adults in this state have difficulty reading. Yet the state continues to fund education with hit-and-miss tactics such as a regressive tax system (which taxes food!) and a lottery. Remarkably, the lottery helps high school students with college expenses but refuses to help adults go back to school.
Paul Krugman weighs in on the folly of the ‘Southern Strategy’ of skimping on education and health care, which is of course merely the bleak consequences of being the poorest part of a wealthy nation that prefers to spend its money on anything but the education and health of its citizens.
Toyota, Moving Northward
"Several Southern states reportedly offered financial incentives worth hundreds of millions of dollars.
But last month Toyota decided to put the new plant, which will produce RAV4 mini-S.U.V.'s, in Ontario. Explaining why it passed up financial incentives to choose a U.S. location, the company cited the quality of Ontario's work force.
What made Toyota so sensitive to labor quality issues? Maybe we should discount remarks from the president of the Toronto-based Automotive Parts Manufacturers' Association, who claimed that the educational level in the Southern United States was so low that trainers for Japanese plants in Alabama had to use "pictorials" to teach some illiterate workers how to use high-tech equipment.
But there are other reports, some coming from state officials, that confirm his basic point: Japanese auto companies opening plants in the Southern U.S. have been unfavorably surprised by the work force's poor level of training.
There's some bitter irony here for Alabama's governor. Just two years ago voters overwhelmingly rejected his plea for an increase in the state's rock-bottom taxes on the affluent, so that he could afford to improve the state's low-quality education system. Opponents of the tax hike convinced voters that it would cost the state jobs.
But education is only one reason Toyota chose Ontario. Canada's other big selling point is its national health insurance system, which saves auto manufacturers large sums in benefit payments compared with their costs in the United States. . . .
For now, let me just point out that treating people decently is sometimes a competitive advantage. In America, basic health insurance is a privilege; in Canada, it's a right. And in the auto industry, at least, the good jobs are heading north. "
Read the whole thing. . .
