Skip to comments.Jack Welch: I Was Right About That Strange Jobs Report
Posted on 10/10/2012 6:06:28 AM PDT by Perdogg
Imagine a country where challenging the ruling authoritiesquestioning, say, a piece of data released by central headquarterswould result in mobs of administration sympathizers claiming you should feel "embarrassed" and labeling you a fool, or worse.
Soviet Russia perhaps? Communist China? Nope, that would be the United States right now, when a person (like me, for instance) suggests that a certain government datum (like the September unemployment rate of 7.8%) doesn't make sense.
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I don't know about "father" of it, but why not assemble US-made device chips in Singapore at a dollar a day per line worker, or for a 14-year-old Irish girl at 75 cents per hour for more complicated stuff? (When he was manager of the Electronic Components Division)
You've called them out... nice.
Happy does not harvest cash. He was doing business in a highly competitive, exploding market in a geopolitical base with a limited menial-job labor pool. He knew that producing semiconductor-intensive smoke alarms with US labor would price you out of the market unless the very skilled semiconductor chip-making was kept in the US, while outsourcing their assembly into SCRs and triacs to Singapore was the only viable economic approach. The simpler 1-amp glass-bead diode technology could be managed with Irish-grown engineers and available infrastructure.
Please note that the semiconductor device market saw a neck-snapping 5X multiplier on the general economics. If the nation had a 1% dip in profits, semiconductors saw a 5% impact. In about 1975, the economy had about 10% dip. At that point, our Semiconductor Products Department released 50% of its employees, permanently and across the board -- managers included. Those to go were the ones with seniority slated for more vacation and broader cost of associated seniority benefits. Also note that outsourced laborers took the biggest and most direct hits, when attempts to preserve the technology base was imperative.
Jack and his philosophy could not survive without shedding the paternalistic protection not only of general non-relocatable employees, but also of engineers and higher-level managers. In comparative technological industries, such as in chemistry-based products, the exemplary Dupont culture of company loyalty did last another 10 years. But that eventually had to go also, and did in the mid-to-late 80s and early 90s. The values of Dupont's culture was turned into cash by Charles and Edgar Bronfman -- the owners of Seagram's Distilleries -- harvested by them from 1982 onward, to the tune of about, say, at least $2 billion in notes taken for their stock holdings in 1995.
China has a bigger, more pliable labor pool than Western societies and no paternalistic morality under socialism. Sic transit gloria mundi.
It entirely depends on how the job is classfied by the US Dept. of Labor.
It's only illegal for employees classified as "non-exempt" employees such as factory line workers who must be paid for overtime.
For "exempt" employees (exempt from the Fed wage & hours laws) such as professional and management employees, casual (unpaid) overtime is perfectly legal and very common.
I did it for over 30 years, but by the same token, I never punched a time clock in those years and didn't get docked pay for less than 40 hours either when I had a doctors appointment or such. I was only asked to get my assignments done and often it would take more than 40 hours for that.
There were a number of occasions when it was far more than 40 hours, and in some of those cases, they did pay overtime while in others, I was told to take comp time to make up for the extra hours that I worked.
Bottom line: It is not illegal.
I did like Jack’s comments about the “secrecy” surrounding the preparation and release of the numbers. I think he should have made an analogy to the “Orange Juice Numbers” in the movie Trading Places... As if the BLS guys walk around with the labor stats in a briefcase handcuffed to their wrists.