At Some Plants, 'US Made' Label Says 'Hard Work'

Despite defense cuts, GE's once-flagging jet-engine factory is poised for a rebound

IF there's one Japanese comment that sticks in America's craw, it's the one made by Yoshio Sakurauchi, Japan's House Speaker.

"US workers won't work hard, but they want to receive high salaries," he was quoted as saying Jan. 19. He blamed workers' laziness and illiteracy for America's poor economic performance.

Although the comments are nearly three weeks old and Mr. Sakurauchi has denied saying many Americans are illiterate, the quote pops up everywhere: on computer bulletin boards, in a senior-citizens' center in Pittsburgh, in casual conversation with blue-collar workers.

And on Monday, Japanese Prime Minister Kiichi Miyazawa said Americans' work ethic is lacking.

It is as though, 10 years after pundits and economists warned that the United States was losing out to Japan, Americans have finally begun to worry about national decline. "We feel something is wrong with the economy," John Sculley, chairman of Apple Computer, said recently in a speech at Harvard University. "Is it just the recession or is it more fundamental than that?"

But in pockets of the US, such as the sprawling General Electric plant in Lynn, Mass., another view is taking shape.

"The people in this area are the most skilled machinists in the world," says Ken Ramsdell, an executive board member of the plant's largest union, Local 201 of the International Union of Electrical Workers. "We are proving it again because we are focused again."

The optimism here is worth noting. Three years ago, this plant looked certain to decline. The company had laid off 4,000 of its 9,500 workers. Defense cuts were hurting the plant's military business. Now, it is holding its own and poised to rebound, despite more defense cuts and a sour New England economy.

There is a bigger change. Management and union workers have started working together after decades of fighting.

"To speak to a manager, you had two or three guys you had to go through," recalls Jim Cunningham, a tool-crib attendant. Product planners in one division couldn't talk with product assemblers, says Michael Sidell, president of Local 149 of the International Federation of Professional and Technical Workers. Local 201's militancy didn't help matters.

So despite the plant's proud history (it developed and produced the first American jet engine), decline set in. GE moved work to other US plants or to companies in Japan and South Korea. Buildings at the Lynn plant were emptied or razed.

"See that hardtop?" asks Local 201 business agent Charlie Ruiter, pointing to an aerial photograph of the Lynn plant. "Fifteen hundred people used to work there. That was my jurisdiction. In 1989, it was all gone. It had been torn down."

By early 1989, the company had laid off 4,000 workers and auctioned off millions of dollars of equipment.

"I have seen workers in this plant, and I was one of them, break down and cry," Mr. Ruiter recalls. "I saw machines go out of here - people spending $1,000 on that stuff when it was worth $100,000.... Back then you had to be crazy to survive. [But] when you go into that unemployment office and you see a couple with seven or eight years of service here [at GE], we were looking at the Grapes of Wrath! I didn't want that on my conscience. You had to do something about it."

"We were looking at 10 years of severe erosion," adds Tim Noonan, manager of Lynn's aircraft-component plant.

That spring, company officials met with union leaders. The plant was making 12 to 15 business-jet engines a year. To win a steady contract, managers felt they had to cut the manufacturing time from 1,200 hours per engine to 900. Unionized assemblers agreed to help. They designed and built new work stations and a work-flow system. The plant won the bid.

By the time GE initiated its new "work out" program of worker-management participation, union leaders and managers here had begun to work together to find other opportunities. Managers got enhanced productivity. Workers saw more jobs.

In the next few weeks, Mr. Sidell believes he'll have rehired all his available planners - the first time in 10 years that he will have exhausted his recall list. The plant is building parts for power plants, bidding on a new contract to build drive turbines and gears for ships, and trying to turn the engine for a military helicopter into a successful commercial turbo-prop.

"It hasn't been a bed of roses," Ruiter says of the work-out program. "You get these yuppies in here with L. L. Bean shirts and button-down collars. They try to get you to vent your frustrations.... We know what that is. But we realize that maybe that's a necessary process."

The turnaround at Lynn is not the norm in the American workplace, but it is not unique either. Such moves in pockets of American manufacturing have helped boost manufacturing exports to almost double their level five years ago. The trade deficit has fallen by half since 1987.

"In 1989 everybody said, 'This plant is out,' " says Louis DeSouza, a GE tool-crib attendant. "Seeing this turnaround in Lynn, it has to be an encouragement to the workers."

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