Back to front.
Golden Wonder makes potato chips and other snacks. They are also closing. For those of you unfamiliar with the term, administration is the same as receivership or Chapter 13 bankruptcy proceedings. Golden Wonder is a privately held company.
For those of you in Cleveland, they're not much bigger than Tom's.
The story is notable specifically for a few lines down near the end of the article:
*Sigh.* It seems that unions never tire of this argument, and what's worse, the public only occasionally rouses itself from slumber to examine the claim and evaluate it. I suspect that there possibly are some cases where factory workers care about the company they're working for, but my experience working in factories indicates otherwise.Usdaw divisional officer Gary Holz said: "The union was only informed today that the announcement was being made and as you can imagine our members have been left absolutely devastated.
"Many of them are in tears and are wandering round in shock trying to come to terms with losing their jobs despite having done nothing wrong except work hard to keep this plant alive."
First off, there is no easy way in most industrial plants to feed back to decision making management ideas about improvement of the operation. Plant managers are going to be disinclined to listen to workers from the line in any event, so such feedback mechanisms would be wasted.
Second, I'd doubt that there are too many workers at the Golden Wonder factory who are skilled labor. Factory jobs tend to not be skilled labor; just about anyone can do them.
Third, it's better for all workers in Britain if inefficient places close and more efficient ones buy the resources of the old plant and re-use them more efficiently. That's how economies grow; people stop making candles and start making lightbulbs.
I'm not arguing that widespread unemployment can't happen; it does happen. But labor mobility and a churn of resource from inefficient industry to efficient industry keeps structural unemployment low. So the folks who are devestated have the story back to front. They should be happy that their plant is closing first, because it gives them a head start on finding new and better jobs.
Comments
Wow, Nae, have some empathy with the human side of it. These people have rent to pay - plus other expenses. Yes, they most likely can find other work, but that does take time - which they have been given precious little of. If they haven't planned on losing their job this week they could be experiencing some major panic and money crunchage.
Posted by: Mara | January 10, 2006 8:25 PM
Oddly enough, these people work in an industry that could be closed tomorrow if the world decided that potato chips aren't healthy. But that would probably constitute mass hysteria and, in an effort to save the potato chip industry governments would begin instituting mass drugging policies in order to get people's heads around the ball. Certainly, most people work for an industry that is unnecessary or a system that is irrelevant. If your job is gone tomorrow, one is only sad because they perceived themselves as somehow relevant. But, sigh, people are not capable of accepting the movement of the world as being independent of their existence and, thus, losing one's job is very challenging.
Posted by: Mendon | January 10, 2006 8:46 PM
I see this as a conflict between macro econ and micro econ. In the macro world, it is a good thing that the world of potato chips is becoming more efficient; in the micro world, the impact on the individual can be devastating. You see the same thing in nature with catastrophic floods, earthquakes, fires, etc. The environment may come back stronger and healthier than ever, but if you were there at the time, you would be dead.
Posted by: Ma | January 10, 2006 8:58 PM
Thanks, Ma. I'm certainly not saying I care whether potato chips continue to be made, nor am I making any statement about the productivity of the plant or even whether these people thought they were relevant (?!). The individuals who lost their jobs know one thing: tomorrow they no longer have a paycheck. (Mendon, mass hysteria? drugging? did you just finish reading Fahrenheit 451?)
Posted by: Mara | January 11, 2006 5:12 AM
I was agreeing with you, Mara. And with Nathan, too, sort of. I was trying to bring the two viewpoints in to relationship with one another.
Posted by: Ma | January 11, 2006 1:46 PM
I really did know that. I got what you were saying - but I guess Mendon's comment sort of came out of left field to me - I was responding to that.
Posted by: Mara | January 11, 2006 2:25 PM
Hi guys!
Losing your job does suck, but what sucks worse, in my opinion, is an entire firm going under because the firm couldn't fire some people when it needed to.
GM is going through something similar right now; the unions protect jobs, but they protect jobs in the short term rather than the long term. Labor flexibility contributes to the long term health of individual companies and the economy as a whole; inflexibility from union agreements, whether in the form of wage stickiness or quotas, weakens companies and hinders growth.
I feel sorry for the people who have lost their jobs, but don't have any sympathy for the union at all.
Posted by: Nathan Dornbrook | January 11, 2006 11:03 PM
I'm a little miffed that anyone would suggest that I'm coming from left field. Here's the argument again, a little more drawn out.
1.) People wake up and decide, as a whole planet, I'm not going to eat potato chips ever again.
2.)People actually stop buying or eating potato chips.
3.) Baffled economists, accountants, marketers, executives, etc wonder what the hell has gone wrong with the obese American public, teenagers, and male bachelors older than 32.
4.) The potato chip lobby begins to ask for subsidies to restructure because they are facing massive losses as grocery stores and gas stations across the nation refuse to carry their products.
5.) Philip Morris, who has their hands deep in the potato chip industry, mobilizes the money of the tobacco lobby to motivate congress to investigate in the sudden and rapid cessation of potato chip consumption. (This also begins to happen in other nations).
6.) The popular media like newsweek and Time begin spouting some crap from some intern who works at the Economist about how the failing chip market is an ill omen of another black Monday.
7.) Ely Lilly, in an attempt to further elongate their control of the toxic chemical Prozac suggests that the reason that people aren't consuming potato chips is because there has been an airborn avian virus that passed to humans that causes a degeneration in the area of the brain that causes "potato chip munchies"
8.) Ted Turner, who has a fist full of dollars in Ely Lilly and MERCK manipulates FOX such that it repeatedly runs commentary on how scientists think that Prozac and Zoloft will cure people of this dearth of potato chip munchies.
9.) Congress considers mass doping measures to keep the Western economy (the primary consumer of potato chips) ahead of the rest of the world. In an effort to rectify the situation children are given prozac along with chocolate milk and a bag of potato chips at school everyday.
10.) X-box releases a first person shooter game, a doctor wandering the streets of New York giving people shots so that they will stop killing one another and peacefully begin eating potato chips again
11.) Somehow, Steve Jobs comes out of the whole thing shining and moving the American GDP up a few notches by releasing the iSnack and accesories iMunch and iCrunch simultaneously.
Ummm. Or I was merely suggesting that the whole industry is erroneous. Why are these people surprised that they've lost their jobs? In theory, they should go to work every day knowing that the possibility of people making smart decisions could rule out their very profession.
Yes, it is sad to lose one's job and can be very challenging to bounce back from that. Most people care less about their work than they do the paycheck at the end of the month. How often do you hear, "I'm just doing this until better options come along."
Posted by: Mendon | January 11, 2006 11:45 PM
Oh, yeah, shame on me for thinking you were coming out of left field.
Posted by: Mara | January 12, 2006 5:29 AM
Mensch, I think that the fantastical nature of some of your suppositions that is misleading.
I mean, bachelors over the age of 32 don't eat crisps. I just don't believe it.
On the other hand, I can't wait to get my hands on the iSnack! Have you seen the new MacBook? Where's the Altivec?
Posted by: Nathan Dornbrook | January 13, 2006 4:09 PM
There are no pan-asain supermakets
down in hell.
So you can't buy golden boy peanuts there;
but the streets of heaven are lined with shells,
and there's billboards of the golden boy
everywhere!
Posted by: Rae | January 22, 2006 3:39 AM