by The Biden administration is making historic investments in American manufacturing – through the Infrastructure Investment and Jobs Act (IIJA), the Inflation Reduction Act (IRA), the Creating Useful Incentives for Semiconductor Manufacturing (CHIPS) and science act and increasing domestic content requirements under the Buy America laws. These investments are important, as the disappearance of American manufacturing has caused unemployment and poverty in many communities.
But while “made in America” may mean more domestic jobs, that doesn’t mean those jobs will be good. There is a mistaken, and often xenophobic, perception that overseas factories are responsible for most of the exploitation of workers and the disappearance of US jobs. The truth is, these things are happening in our own backyards.
Take Hyundai for example. The Korean automaker is emerging as a big player in the electric vehicle game, even riding Tesla’s bumper. But Reuters earlier this year found children as young as 12 working at two of the company’s suppliers in Alabama. Correctly-12 years.
Companies like Hyundai that stand to benefit from these recent federal investments and will be major players in the green economy must now set the bar for what it looks like to be a good employer in the US. And right now, with evidence of child labor, this bar is on the floor.
In many ways, Hyundai’s practices represent many of the factors contributing to a “race to the bottom” in American manufacturing. Like many other companies, Hyundai received millions in tax incentives to set up shop in Alabama, a state known for handing out billions in subsidies to companies with questionable returns on investment. (Disclosure: the author of this study is a former Alabama lawmaker employed by Jobs to move America). It is disgusting that our tax dollars could be supporting child labor, a practice that was supposed to have ended in the 1930s.
SMART, one of Hyundai’s suppliers that employed children, defended itself by saying it uses temporary employment agencies to find workers. This is another problem plaguing American manufacturing — many companies use temporary workers to avoid paying benefits or allow workers to unionize.
Not only is the precariousness of temporary work worrisome for an industry once known for good, long-term union jobs, but the constant flow of new workers into physically demanding construction jobs using dangerous equipment is a recipe for an unsafe work environment. (In fact, according to Reuters, the SMART plant has repeatedly violated health and safety regulations.)
Those disproportionately affected by this dangerous temporary work are black workers, who make up 33% of temporary workers in manufacturing and warehousing occupations, even though they make up only 15.5% of the total manufacturing and warehousing workforce.
Since temp workers aren’t technically company employees, these companies act as if they don’t exist — yet these workers still produce the products that contribute to profits. Employers must take responsibility for abuse that occurs in any place that manufactures their products.
The “race to the bottom” in American manufacturing is most literal in the government procurement process, where private companies like Hyundai win contracts to supply vehicles to government agencies without any requirement for equity or good jobs. We need to encourage public bodies to take a more proactive approach to incentivizing good jobs and equal, secure jobs as part of the bidding process. Some call this common sense practice “marketing for the common good.” This would simply require public agencies that buy or subsidize clean technology to award extra points for their commitment to high job standards, such as wages and family-sustaining benefits. The US Jobs Plan provides a framework for the integration of equity capital in government markets and is used by many major public bodies. We must embed our values in our public decisions and demand that companies deliver a real return on our taxpayer investment.
Fortunately, there are companies that set the standard for what “made in America” should look like. My organization, Jobs to Move America, has negotiated Community Benefit Agreements (CBA) with major global electric vehicle manufacturers BYD, Proterra and, most recently, New Flyer of America. At BYD, for example, CBA led to a first-of-its-kind electric vehicle manufacturing training program. Not only were the participants taught how to be successful at BYD, but they can transfer these skills to other electric vehicle companies. BYD is a competitor to Tesla, proving that you can do things the right way while still being competitive in the EV market.
Rebuilding American manufacturing will not only make us more resilient to the crises that have become so common these days, but it also has the potential to provide good-paying jobs to people who face barriers to completing traditional education. But manufacturers have to do things the right way, or “made in America” will start to mean “made under injustice.”
