Quick! Which will earn you more: a doctorate in physics and a professorship at a university, or a high school diploma and a job with Chrysler? It doesn’t take a PhD in economics to guess the right answer to that one. Dr. Mark Perry from the University of Michigan looked at the average total compensation for auto workers (Big 2.8 and transplants) and college professors. He found the average autoworker with a high school diploma and maybe a year or two of technical school earned about $134K per year, while the average college professor makes about $93K in exchange for eight years of college and post-grad work. We won’t even look at what the typical high school or elementary school teacher makes in comparison to the janitorial staff in the auto plants.
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Don’t forget to take into account the opportunity cost of higher education. In addition to the out of pocket expense of, let’s say, $100,000 for your education, you’ve got to cover 8 years of not earning $60,000. So you’re over a half million in the hole to start with.
Thanks, UAW!
Thanks UAW? College grads feeling burned by tuition and comparatively lower salaries should be thanking their peers. Who buys more domestic cars and creates more domestic jobs? The auto workers themselves and probably those with less formal education. Who is buying foreign products and reducing high-paying domestic jobs?
Thanks, college grads!
La-La land.
It’s bad enough that the league minimum in most sports leagues (paid to benchwarmers that are barely talented enough to be there) makes a sheer mockery of the salaries we pay to teachers, first responders, and other very important jobs…but the guy that snaps panels on doors in your Chevy Malibu?
It’s hilarious that most of these folks would howl about making “only” 50-60k
Steve_K:
“Who buys more domestic cars and creates more domestic jobs? The auto workers themselves and probably those with less formal education.Who is buying foreign products and reducing high-paying domestic jobs?”
Yup, you’re probably right. My personal problem with unions is government enforcement. If people want to get together and “stick together” and strike on a whim, more power to ’em. However, a company has every right to hire replacements without the gov’t’s guns pointed at them.
So for right now, I’ll fall into your second camp and keep buying foreign. If I buy a $20,000 domestic car, I’ll feel like I’m buying $10,000 worth of car and $10,000 worth of high wages and jobs banks. If I buy a $20,000 foreign car, I’ll feel like I got $18,000 worth of car and $2,000 worth of markup, chicken taxes, and ripoffs.
Dont worry all the jobs will be outsourced and we will be left with nothing. I am in construction they import their outsourcing It is almost where you have to use illegals as labor to survive as all the good contractors got driven out. Same will start to happen with a lot of white collar jobs i think the auto workers should be paid well ,not as well as they are when quality is up you are paid well when it is down you are paid less i think that could weed out a lot of issues. but the party is over .i hoped they saved their money and saw the writing on the wall. I really hope we all arent driving chinese autos soon. We need to have manufacturing in this country we cant just produce paperwork. Everybody can’t go to college. I didnt we were dirt poor. I worked my way up in construction started a small company we were doing fine till the illegal invasion now we cant do work cheap enough to do a good job. I really hope america just doesnt become a service economy. Everybody cant work for tech co. we need jobs with decent wages for everybody Kick out illegals driving down wages Limit H1-Bs To truly smart people and keep jobs here i think after the Cohen&Grigby video it would have be a wake up call for everybody too much income disparity my bring about change we arent ready for if you have nothing to lose you take drasic measures I own american, european and japanese vehicles. The funny thing is My two dodge trucks Have less problems then my audi and the lexus i have is great but the most boring car on the planet it has 250 mile and i want to get rid of it.
Why all the animosity towards the UAW? If you buy a car that was actually made in Japan or Korea, guess what, it was made by a union worker. Just not a UAW worker, Most auto workers in Japan, Korea and Germany are belong to their respective unions and yes that makes all of them more susceptible to outsourcing whether it is to China, Mexico or eastern europe. The UAW even makes Corollas and Tacomas but I never hear anyone say I will never buy a corolla because it is UAW made. I only hear that kind of talk in internet forums
Getting a job at Chrysler is probably very difficult right now so this is not a very realistic comparison. Inequities exist in many places. Besides I know several people with degrees in physics and philosophy that are not teaching, they couldn’t get jobs in academia either because it is somewhat of a closed system. They were smart enough though to find jobs in the business sector and they are doing extremely well.
Professors are not expected to lecture for eight hours per day, five days a week. Autoworkers must show up for work for at least 40 hours per week, and even more if overtime is included (which it probably is in these figures).
Also, working conditions for those in academia tend to be more pleasant than what we would find in a typical automobile factory – even a modern, up-to-date factory. Classrooms are air conditioned and clean. Professors generally do not have to clock in and out for their lunch breaks. And I doubt, for instance, that auto workers get to look at comely co-eds during the working day (or handsome ones, for the gay or female folks out there).
Finally, professors may supplement their income by writing books and articles, and, at the more prestigious institutions, are expected to do so.
No doubt certain productivity and health care cost issues must be addressed in the coming round of contract talks, but comparisons such as this really aren’t all that meaningful or helpful. They do little more than put the union on the defensive. Considering that the UAW isn’t going anywhere anytime soon, this isn’t going to lead to a realistic contract that helps the domestics.
Holy crap, this is why I have ZERO sympathy for unionized autoworkers. They are MASSIVELY overpaid, a result of the government interfering in markets so as to protect monopoly labor, leading to this absurd situation.
And we’re supposed to believe that companies outsource because of the few thousand bucks a year that health care insurance costs?
I absolutely, positively will NOT buy an American car as long as the UAW still exists (which I suspect won’t be long).
UAW, hurry up and die.
Umm Kevin you do know the Toyota Corolla and Tacoma are made by UAW workers in Fremont California. The UAW will contract but it will not completely die off
I have no sympathy for college professors. They have cushy jobs with incredible security and what they lack in cash compensation they make up for in the ability to do essentially whatever they want with their time. Like complain about their lot in life by looking at how much auto workers get paid.
I’m writing this as a grad student in chemical physics who is 2 weeks away from my PhD. I have had numerous offers to continue in the academic route and have turned them all down. My main reason for tuning down the work? The pay and benefits do not account for the required work:
Professors are not expected to lecture for eight hours per day, five days a week. Autoworkers must show up for work for at least 40 hours per week, and even more if overtime is included (which it probably is in these figures).
Professors do not lecture for 8 hours, that’s true, I’d say 3 hours 3 days a week is probably about average. However, there is proposal writing, meeting with students, paper writing, fixing what the students broke in the lab. All of this adds up to a MINIMUM of 60 hours a week. My graduate advisor’s hours are about 8:00AM to 9:00PM 6 days a week. I could never do that. And he still feels like he’s falling behind in doing the latest greatest research.
Also, working conditions for those in academia tend to be more pleasant than what we would find in a typical automobile factory – even a modern, up-to-date factory. Classrooms are air conditioned and clean. Professors generally do not have to clock in and out for their lunch breaks. And I doubt, for instance, that auto workers get to look at comely co-eds during the working day (or handsome ones, for the gay or female folks out there).
You may have a point here, generally the conditions aren’t too bad. But often the place where you spend most of your time (the lab) is a dirty dangerous place that’s only cleaned up twice a year when OSHA comes by for inspection.
Finally, professors may supplement their income by writing books and articles, and, at the more prestigious institutions, are expected to do so.
You can supplement income with books, but generally who will buy the book? The 30 students you have a year and no one else, there is no real money in book writing, it’s all done for ego. You don’t get money for articles. In general, it costs money to get an article published. Usually the first 10 pages are free and then it’s something like $500/page after that. Of course that comes out of grant money, not your salary. But you get no money for articles, again it’s just for the ego.
Geeber,
Because an autoworker has a harder job in harsher conditions, they should be paid more than a college professor? Using this type of logic the guy who cleans carnival port-a-johns should make more than both of them. A job’s pay has nothing to do with how “hard” it is. It’s based on how badly a company needs a skill and how scarce the skill is. The agreements between the domestic automakers and the UAW simply inflate the scarcity of autoworkers.
miked, thanks for the “inside scoop.” Regarding the articles – who will buy the book depends on how good it is. And I know professors who have written textbooks that are used by students throughout the country.
craigefa: My point is that this is not an apples-to-apples comparison. And it is not helpful as the contract negotiations begin. Things need to change in the domestic auto industry – no argument there. But writing articles like this, which serve mainly to put the UAW on the defensive, really aren’t helpful. The UAW isn’t going anywhere anytime soon.
Those who know me, however, would be amused to read even the suggestion that I am too lenient on unions….
Holy crap, this is why I have ZERO sympathy for unionized autoworkers.
You and me both. They deserve half of what they get. If they find themselves out on the street, TOUGH! They’ve had it way too good for way too long, now it is catching up to them. I grew up in a town with a big Ford plant, and I honestly don’t care if they end up begging on a street corner. The only problem is that if they don’t get a big enough package they’ll soon be sucking on the taxpayer teat.
Not only are they grossly overpaid compared to other much more skill intensive trades, but typically the assembly quality of 2.X vehicles from Mexico where they make a small fraction of the wages is much better as shown by internal quality audits.
I’m convinced that the public in ever increasing numbers will refuse to buy 2.X vehicles until the UAW is gone.
You want to compare apples with apples. It takes much more skill to diagnose and repair cars then to throw a part on over and over, working conditions are generally better in the factory then in a dealer shop, and the guys in the factory still make many times more then a good tech. What’s wrong with this picture?
I once turned into a downtown parking lot in the capitol city of my original home state once by accident. There were two Bentley’s, a BMW, two Mercedes S-Class, a Cadillac brougham and an Avalon in the lot. I thought, this must be a law firm?
Nope, it was the state federation of labor.
Now, I do think that labor in this country is not getting the best deal overall, esp. in health care and wages keeping up with inflation, but some segments of labor do enjoy an incredibly privileged position that allows these kinds of comparisons to be raised.
College professors are in a tenure track, with great rewards possible further down the line. Thus, they will be willing to accept a lower wage in the meantime, knowing they will be compensated if they succeed in gaining a tenure position. For the same reason, in high-end restaurants you will often see that the waiters are paid more than the sous-chefs, because the chefs work there with the hope of promotion and gaining recognition.
Most professors tend to enjoy their job, and it is often one to which they have aspired. Thus, they are compensated intangibly, while manufacturing laborers require direct compensation. Also, as mentioned here by several others and before by Adam Smith, work that is unpleasant requires higher wages in order to induce workers to supply their labor to such an undesirable position.
Sherman, I’m aware of NUMMI, so thanks for reminding me not to by a Corolla or Tacoma either, no prob!
But now that I’ve calmed down a bit, whether professors deserve their pay or not is beside the point here. Pay should be and usually is based on supply and demand for labor. There is an enormous supply of people who could be competent assembly line workers.
If free markets were allowed to work optimally, without monopoly labor egregiously distorting them, those wages would probably fall to what, 40 or 50K maybe?
The laws of economics can only be held at bay for so long (ask the Soviet Union). That is why auto worker jobs are deserting Michigan and going south and non-union, and to other countries.
Consumers should understand that US auto workers have been grabbing money right out of the consumers’ pockets, and they still seem to have a deep sense of entitlement that they have a God-given right to continue doing that. Well, looks like more and more consumers do seem to understand that every month, based on the sales tables I see every month in Automotive News.
While it’s entertaining to see the salary comparisons, it’s not really relevant. There are two basic realities —
-The market ultimately sets prices (and wage rates), aside from any price controls that might be in the system, such as minimum wage regulations.
-Prices can be negotiated.
Union workers figured out that they could do better through collective bargaining than through individual negotiation. Negotiating as a unit gave them leverage that they didn’t have by themselves. We can quibble about whether or not we like it, but forming alliances and creating leverage in order to cut better deal terms happens all the time, and there’s nothing wrong with building your hand in order to do better.
-If professors haven’t figured out how to cut a better deal, that’s really their problem. Only Marx believed that the value and price of labor should be commensurate to effort (the badly mistaken Labor Theory of Value), when all of us should know that the market creates an equilibrium price that can be optimized through skilled haggling. Instead of taking pot shots at workers just because they don’t have the education, the profs would be better off in (a) doing a better job so that they offer greater value and therefore support a higher price and/or (b) forming alliances with each other in order to negotiate better terms. To take potshots at someone else’s deal is just petty jealousy.
Pch101: While it’s entertaining to see the salary comparisons, it’s not really relevant. There are two basic realities –
-The market ultimately sets prices (and wage rates), aside from any price controls that might be in the system, such as minimum wage regulations
You’re absolutely correct here that the market ultimately sets the price. And I actually think that the comparison between Professors and the Unions is a great example of the market at work.
The basic rule is that the fewer number of people who want/can do a certain job, the higher the wages will be.
So what did the Unions do? They got together and said, no one will work for less than X, which then forced management to agree. Normally I don’t have a problem with this, but when they get the government involved and make it illegal for management to hire replacements that are willing to work for less, then I get mad. So Unions artificially lowered the number of people that will/can do a certain job, which then raises their wages.
Now, lets look at what happens on the side of the professors. Generally to succeed in academia (particularly in post graduate work) you need to be weird. Academia rewards those who can perseverate on one topic (some may say have autistic tendencies) and really understand something. So what happens to all of those who get PhDs in weird things? Well their only hope is to continue in academia, there’s not much use for them outside of that little artificial world. So what you have are a large number of hyper competitive people who really only care about showing other hyper competitive people how smart they are, so they fight tooth and nail to get a professorship. So since there are so many people willing to work for a particular job, the wages go way down. That’s why I chose not to go the academic route. While I am a bit weird, I’m not as crazy as the people willing to fight for professorships (especially for the amount of money they pay), so I have to now look for a job in the real world, which will be less secure than an academic job, but will pay a factor of at least 2 more for much less work.
So on one side (the Unions) you have an artificial work shortage which leads to high wages and on the other side (the Professors) you have an artificial work surplus which leads to low wages.
Lets try this Kevin. GM Ford and Chrysler continue to lose market share because they have been run into the ground by morons. Why do I say that, simple the Tacoma and Corolla have been and contimue to be sales successes and are built by the UAW. Lexus and Scion which continue to enjoy sales success are built by Japanes union workers.
BTW their wages are around 50k
Wow, our non-union people in Alabama (building Odysseys, Mercedes SUVs, and Hyundai Sonatas…all class-leaders, arguably) start around $14/hr and basic benefits. That’s considered pretty damn good in places where it’s more than twice the local fast food salary.
Maybe there’s a “loser premium” built in…ie, they get paid extra for working for a company that may not be around much longer ;)
I have no sympathy for non-union workers. That includes college profs. If one hasn’t the gumption to unionize or look for a job where the union is already in place, then one makes less money. Consider it a tax on cowardice.
I just can’t believe there are so many people green with envy and filled with hatred because someone else is doing better than they are.
Oh man were getting beat up bad today.I see things a little different I don’t care what the prof. makes or the cop or the writer[I’ll betcha Stephen King makes more money than R.F.both of em are great writers]
Point is, you play the hand you were dealt. As an 18 yr old in 1972 I made more than my college educated dad.My dad was cool about it.My dad said hey kid count your lucky stars.
Now in 2007 folks get all pissy about it.For all intents and purposes,its a way of life that is over.
Lets not get mean and nasty to us few dinosaurs that are left
Dynamic88 the flip side to that argument is to have no sympathy for the laid off union worker and to consider that a tax on not having the gumption or foresight to get an education. Its easy to dislike categories of people. Its much harder once you know the actual person.
In my opinion, people are simply people period.
I don’t know how everyone else feels here but everytime I get in my Cadillac I feel like someone has stolen and is still stealing money right out of my pocket. I blame the entire unit that made that car for the junk it is: management, engineers, CEO, Union labor, paper pushers. They all work for the same company with the same goals(I think) so they are all to blame IMO. Now I could care less about how much people are making if the end product is great. But I have a real problem with paying royalty just for the privilage to own their JUNK.
Exatly sherman you can’t judge my mind by the color of my collar.My spelling and grammer maybe, but not my occupation.
So what happens to all of those who get PhDs in weird things? Well their only hope is to continue in academia, there’s not much use for them outside of that little artificial world. So what you have are a large number of hyper competitive people who really only care about showing other hyper competitive people how smart they are, so they fight tooth and nail to get a professorship.
Perhaps that’s part of the problem. The willingness to do it for love, not money, lowers the price point.
One reason that wage rates for UAW workers is so high is that the work sucks. The wage is meant to compensate for the safety risks of working around heavy machinery and for the grind of the routine.
When Henry Ford doubled the wage by creating the $5 day, it was in large part because the work was so bad that the only way to reduce turnover (and therefore keep the line moving at maximum speed and increase capacity utilization) was to pay them more money.
The problem today is that the cars are now generally so undesirable that the Big 2.8 are now burdened with capacity that they no longer need. If the products were more desirable, the capacity would be needed because the products would be demanded. As is true with most things, excess capacity is a symptom more so than it is a problem.
Union workers figured out that they could do better through collective bargaining than through individual negotiation. Negotiating as a unit gave them leverage that they didn’t have by themselves. We can quibble about whether or not we like it, but forming alliances and creating leverage in order to cut better deal terms happens all the time, and there’s nothing wrong with building your hand in order to do better.
OK, so they are way ahead at halftime, let the buyers unite and bury them.
I just can’t believe there are so many people green with envy and filled with hatred because someone else is doing better than they are
Envy? LMAO
the nature of the work does play into this. because professors will work for less money if they have to, and its not easy to get a professorship, trust me. phds.org can tell you all about that. on the other hand, working on an assembly line is not exactly the most desirable job. but still, think of what would happen if professors united? The job is so specialized that its not nearly as easy to find good professors as it is to find good assembly-line workers. anyhoo, I think that union people get paid way too much, more than they deserve. unfortunately, a whole bunch of them are getting laid off as we speak. we’ll see how they like the job market that asks you for your credentials and your credentials only, as opposed to how many other s are willing to go on strike with you.
The problem is that the earned UAW worker’s “benefits” aren’t going to the current workers; the benefits are going to retired workers. When the current workers retire, the big 2.5 will be out of business and not pay off the earned benefits. So, it’s fine to say “labor costs” are $150k/year because the auto companies need to pony up that much to keep the union workers on the job, but it’s not fine to say that the workers enjoy $150k in salery+benefits, as the benefits are going to someone else.
“BTW their wages are around 50k” – refering to Japanese workers.
You did not take into account the health care, allowances, and benefits. I would wager that the overall compensation for Japanese workers is twice that amount AND they do indeed get a pension.
However even though the differences aren’t that great with the Japanese and American unions, I will say that auto workers in both countries are very well compensated for the work they do. So are executives, attorneys, accountants, and even yes, auctioneers and dealers in the auto industry like yours truly. I also know more than my share of repair shop owners, transportation operators, repo companies and rebuilders that make a very pretty penny for the work they do.
There are many reasons for the high wages. Scarcity of supply, exceptional performance, industry driven collusion, nepotism, professional organization, and legal precedence all play a strong role in the auto industry’s wage game.
The reason why these studies stink is not because they may be biased or engender prejudices. It’s because they don’t encourage any reasonable discussion that can be used for a constructive purpose. This thread pretty much exemplifies it. The old ‘They/You don’t deserve it’ arguments don’t do anything but get emotions up. We need in depth discussions. Not sound bites and cliches.