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STEVE INSKEEP, HOST:

American automakers have created thousands of new jobs, and the auto industry's expansion has created tens of thousands of jobs at auto suppliers.

Michigan Radio's Tracy Samilton has the latest in our economic series "Looking Up."

(SOUNDBITE OF MACHINERY)

TRACY SAMILTON, BYLINE: Bridgewater Interiors in Warren, Michigan, has picked up the pace. The factory's hundreds of union employees are busy filling a growing number of orders. The factory floor is jam-packed with stacks of foam cushions and seat covers and headrests.

Ron Hall is vice president of the company. He slaps on some safety glasses and a bright-yellow vest for the tour. He points to a big, blinking screen overhead.

RON HALL: So we have a computer system that's linked to, in this case, Ford Motor Company's Dearborn truck plant.

SAMILTON: That link enables Ford to tell Bridgewater exactly what kind of seats it needs for each truck moving down the auto company's assembly line, 30 miles away.

HALL: And so, you know, we've got to be able to get that exact configuration and do it in about a three-and-a-half-hour window, and do it all in sequence.

SAMILTON: This factory was not so busy a few years ago. Consumer demand fell so fast, so hard, that people who study the industry had to go way, way back to World War II to find another time when per capita, Americans had bought so few cars. And with two big customers, GM and Chrysler, going bankrupt...

SEAN MCALINDEN: Suppliers were terrified.

SAMILTON: Sean McAlinden is an economist with the Center for Automotive Research.

MCALINDEN: A lot of them thought they'd go down to one plant, you know, like one heartbeat a minute.

SAMILTON: In fact, for many, the heart stopped beating. Hundreds of suppliers went bankrupt. Hundreds more didn't even bother to file for bankruptcy. The owners just sent their workers home, locked the doors, and walked away.

MCALINDEN: There's machinery inside with no tooling. But it's covered in dust and no workers, right? Such plants would take months to fire back up.

SAMILTON: Bridgewater Interiors laid off hundreds of its workers. Michigan Automotive Compressor, a non-union plant in Jackson, Michigan, offered a buyout to its employees. For those who stayed, at least there were no layoffs.

DARRIN DUNGY: They actually allowed us to have Fridays off.

SAMILTON: For no pay. Darrin Dungy has worked at the company they call MACI for 11 years; Laurie Cervantes, for 16.

LAURIE CERVANTES: Just had to cut out on things that weren't important until things got better. We just rode out the storm.

SAMILTON: While Bridgewater Interiors has rehired everybody it laid off, workers at MACI are sometimes putting in as much as three hours overtime a day, six days a week. Still, Dungy says he doesn't hear many complaints.

DUNGY: Going through that spell, what I found out on my line, is associates are a little bit more appreciative of what they got.

SAMILTON: In a dramatic reversal, many suppliers, after improving efficiency, downsizing, giving buyouts and the like, find themselves shorthanded. At the same time, when it comes to hiring new people...

JERRY KURFESS: We're trying to be very careful.

SAMILTON: Jerry Kurfess is head of human resources at MACI.

KURFESS: You know, there's still a lot of hesitancy about the future just because of where we've been in '09 and, you know - and seeing companies come so close to the brink - and wanting to make sure that we don't go there.

MCALINDEN: This is a very major concern. If we reach the $15 million sales level for a year...

SAMILTON: And sales were nearly $13 million just last year...

MCALINDEN: ...the industry will reach a choke point.

SAMILTON: Meaning, says economist Sean McAlinden, a shortage of parts; hence, a shortage of cars. He says the supplier industry will need 174,000 additional workers by 2015. And the pace of hiring right now appears to be too slow.

When all those supply companies went dark, many skilled tradesmen, machinists and engineers moved on. Ron Hall, of Bridgewater Interiors, suspects a lot of people are on the sidelines right now.

HALL: They don't know whether to believe if the recovery is real. We're here living it. And we've been living it long enough now - for you know, two years - that we know that it's real.

SAMILTON: Meanwhile, car companies are upping their forecasts for car sales this year. Suppliers say no matter what happens, they're absolutely committed to doing what it takes to meet the demand today, and the demand tomorrow.

For NPR News, I'm Tracy Samilton in Ann Arbor.

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