Monday, August 23, 2010

Caterpillar Restarts Its Growth Engine - In the South

So reads a headline in the Wall Street Journal (WSJ) dated 8/12/10. The article is a little more detailed than the one on the same day in the Journal Star. (JS) The new plant in Victoria, Texas, a right to work state, will employ more than a 1000 new jobs. "It's a major shift in manufacturing strategy for Caterpillar. It's all driven by cost reduction. It is not just labor costs;#1,my comment)its the cost of exporting and attempting to shorten distance between the supplier base and production facilities" says a Chicago based forecaster for the construction machinery industry.

This shift of business is just a series of Caterpillar moves out of Illinois including shifts from Aurora,(Cat says displaced people in Aurora will move to other Cat jobs in Aurora) Morton, Decatur and Peoria announced so far. In the meantime of the approximately 25,000 Caterpillar employees laid of or fired, only a few of the approximately 5300 rehired are from the United States.

This country, and especially Illinois, under Obama, the Democrats and the unions, is basically dead when it comes to manufacturing growth. We are becoming a health and service industry country where the jobs do not pay as much and the lower end jobs taken by illegals; most illegals in this country whose major skills are "hard work".

While their has been some construction out at Mossville, insiders say it is mainly more office space. I believe if you took a "Facility Tax Referendum" just among non-union and non-management Cat workers right now, the referendum would fail. Many of these people think the $53 million Cat is spending on the museum and visitors center could have been better used by the within the company for its shrinking manufacturing employee base.

While manufacturing employment is up for by a couple hundred thousand, most of this employment has been in the subsidized part of the auto industry. Look for more consolidation in this country and no change in the unemployment figures as small businesses have little idea where this administration is taking them.

Probably for the ride of their lives. I would not want to be a small business owner today, even if I had a niche market. Too much paperwork and worry as starters.

And then again, what has all the hype over TranPort gotten us here in Peoria?

Hm.

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