Episode 623: The Machine Comes To Town : Planet Money In Greenville, SC, the best job option isn't to compete against the robots, but to make friends with them.
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Episode 623: The Machine Comes To Town

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Episode 623: The Machine Comes To Town

Episode 623: The Machine Comes To Town

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ADAM DAVIDSON, HOST:

For the last few shows, we've been talking about the robots coming to take your jobs. And we've told you the story of the first people to fight the machines. But what happens to a place where the machines come and people thrive, when the best job option isn't to compete against the robots but to make friends with them? Hello, and welcome to PLANET MONEY. I'm Adam Davidson along with Chana Joffe-Walt, who you'll hear later in the podcast. Today on the show, I travel to Greenville, S.C. to look at manufacturing. People say all the time, oh, manufacturing is dead in America. We don't make anything anymore. But that's actually not true. The dollar value of what we make in this country has gone up and up and up. But we do that with fewer and fewer workers. So today, we'll show you how people who do work in manufacturing - and there still are millions of them in America - how they've adapted to the machines.

(SOUNDBITE OF MUSIC)

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DAVIDSON: I first visited Greenville, S.C. a few years ago. And right away it struck me as almost like a metaphor for the current state of American manufacturing. In the same town, there are these giant, hulking but completely abandoned and crumbling textile mills. And there are also these brand-new, sparkly, high-tech factories, like the big BMW plant. I went to one of the very last mill bars. It's called Christine's Place. Terry Suttles owns the bar. She remembers the good old times, when manufacturing and the mill economy were flourishing.

TERRY SUTTLES: Everybody knows somebody that worked in the mill. And usually they was hiring. And if you had a friend, you could always get in, you know? I wasn't really old enough to work. But I went to work.

DAVIDSON: Like 16 or younger?

SUTTLES: I was about 16.

DAVIDSON: Did you drop out of high school?

SUTTLES: Yes.

DAVIDSON: Which everyone did around here, right?

SUTTLES: Yeah.

DAVIDSON: 'Cause why...

SUTTLES: You made more money. You could just make money. I mean, you know, and it was good money.

CHANA JOFFE-WALT, BYLINE: Oh, that is, like, an America that does not exist anymore.

DAVIDSON: It does not exist anymore, exactly. I mean, it would've been almost nutty to continue finishing high school. Why? Everything you need to know to thrive in the world, you were going to learn on the mill while you were working.

JOFFE-WALT: And you could make enough money to live and have kids and pay for things.

DAVIDSON: Yeah. People said you would own your own home. You'd own your own truck. And crucially, you'd own your own boat. And you would have, you know, a week or two a year that you could afford a vacation. They weren't rich by today's standards. But they did very well by their own standards, and they knew it.

WAYNE STATON: We - we've had a good life.

LARRY HALE: We've had a fantasy life.

STATON: Yeah.

JOFFE-WALT: Did he say we've had a fantasy life?

DAVIDSON: We've had a fantasy life. I thought that was amazing. That was Wayne Staton (ph) and his buddy Larry Hale (ph). They were both mill truck drivers. So they would take cotton to the mill. And then they would take the finished products and drive them all over the country, wherever they needed to be.

DAVIDSON: A fantasy life?

HALE: Yeah, we've done things that a lot of people dream of doing that never ever have a chance to do it.

DAVIDSON: Like what?

HALE: Like when I went to Canada, and I started dating this hairstylist up in Canada who wanted to marry me - and down in Mexico, the things I've done and when I lived in Houston, Texas. We lived a fantasy life. We lived our life to the fullest. You've got to cherish everything that's out in front of you. You've got to grasp it and to love it. And if you don't, you're losing out. Love everything.

STATON: Well, I wouldn't say everything, Larry.

HALE: Yeah, I agree with you there.

(LAUGHTER)

DAVIDSON: One thing I noted in this bar, the old guys, they had made enough. They had a pension or they had enough Social Security. They owned their home and their boat and their car. And they're doing OK. But their kids, their kids have left. If you're not going to be able to get that education, that higher skill, there's just nothing here for you.

JOFFE-WALT: So I'm getting the picture of definitely a familiar, like, dying American manufacturing town that we've heard a lot about, where the jobs are just sort of disappearing. But Greenville is also a place where something different is happening.

DAVIDSON: Exactly. Just within a few minutes' drive of Christine's Place, there's a BMW plant down the road in Spartanburg, BMW's only big manufacturing plant in America, Michelin's big tire manufacturing plant. I went to a place that specializes in cutting incredibly complex, high-tech metals with incredibly precise, high-tech tools, where you'd really need to understand all sorts of things about chemistry and physics to work there. And these are factories that make a lot of money. This is a booming part of our economy. This is a very healthy part of our economy. But they generally employ far fewer workers than you would have seen at the old mills. And the workers they do employ, at a very minimum, need a high school degree. But to get the really decent jobs, you need much more than that. You need some really specialized skill. After visiting a bunch of factories, the one that I thought really represented this trend I wanted to understand about the distance between low-skill and high-skill work was a factory owned by Standard Motor Products. Standard Motor Products makes replacement parts for car engines. So they do it under a lot of brand names like NAPA and AutoZone. So it's a decent chance that people who have replacement parts in their car have Standard replacement parts. They just don't know it. And when I first went, you know, you think auto parts plant. I don't know what you picture. I picture big machines, grease and, like, big, hulking guys and, you know...

JOFFE-WALT: Like blue jumpsuits.

DAVIDSON: Exactly. Well, they do have the blue jumpsuits. But other than that, it was very, very different. It was people often hunched over tables with microscopes, people typing into computers attached to very clean machines that do their work inside of a box in a very clean, precise way. It looked almost more like a really big high school science lab than what I would picture as an auto parts plant.

JOFFE-WALT: So, like, big, robotic parts that are, like, doing all the work sort of very separate from the few people that are actually on the floor.

DAVIDSON: Exactly. And it's not nobody. I mean, they employ, you know, a thousand or so people. But it's a huge place, you know, turning out just hundreds of thousands of parts. So, you know, the person-per-part or the person-per-dollar value of output is much, much lower than it used to be.

JOFFE-WALT: The expensive things in that building are the machines.

DAVIDSON: Yeah. Now, the woman that I ended up spending most of my time focused on is a young woman named Madelyn, Maddie Parlier. She's 23. She has two kids, but she's a single mom. She's pretty, short blonde bob, and very intense. I mean, she has these big blue eyes and just stares right at you. And she will tell you her entire life story. She's totally straightforward about the poor decisions she's made, the good decisions she's made and how she wants to make a great life for her kids and how hard that is. She used to work making kayaks, which is real manual labor, you know, really putting your shoulder in it, you know, carving out the shape of the kayaks. So she came to this auto parts plant. I think she had a vision kind of like ours, of a lot of tough work. And she comes, and her job is to push little buttons.

MADDIE PARLIER: You know, I'm here all day. And I'm used to sweating - I mean, really sweating. You know, I come here, and I'm putting pieces. And I was like, what am I doing (laughter)?

DAVIDSON: Because it's so many machines doing what people...

PARLIER: Right. It's so different to see how far factories have come from the old time that I'm used to. It's an eye-opener.

DAVIDSON: It's so automated. I mean, I watched her train another new worker. And it literally took two minutes to be trained in this job. But that is not the growth area of employment here. I mean, the growth area of employment are the people who actually know how to trouble-check those new manufacturing machines, how to run the computer software that runs those machines, people with a lot more skill than Maddie.

I see a microscope.

RALPH YOUNG: Yeah, we have a microscope, a hot stand, snap gauges, ID gauges. We use Bore Mics, Go-Nogo plugs. We do - we run here about...

DAVIDSON: That's Ralph Young. And I came to think of him as the perfect model of the new American factory worker. He knows everything. I mean, you should just see the other really highly-skilled workers just, like, staring in reference at Ralph Young. I mean, these machines that cost half a million dollars and are incredibly complex electronics and hydraulics, he can just take them all apart, put them all back together. But that's not even a fraction of what he knows. He knows the different kinds of aluminum that go into a fuel injector and how those different kind of aluminum react to heat and react to cold. He's a qualified electrician and a qualified plumber. He just has this encyclopedic knowledge. And at the heart of this process is something he also is an incredible expert at - CNC, computer numerically controlled. And it's a complicated computer language that tells these really expensive machines exactly how to cut the metals. And Ralph, no surprise here, is also an incredible specialist in CNC programming.

YOUNG: When I came here 20 years ago, we didn't have CNC equipment. It was all manually, screw machines. It was more of the hammer-and-screwdriver-fix but where now it's all finesse.

DAVIDSON: That phrase, now it's all finesse. I felt like that should be the motto of American manufacturing.

JOFFE-WALT: Welcome to Greenville. Now it's all finesse.

DAVIDSON: Now it's all finesse. And not everyone knows how to do finesse. I mean, you know, I pictured this one machine, if we went back in time, would be replaced by dozens and dozens of machines, where people are, you know, cutting the metal themselves, moving the metal themselves and not able to do things that we can do now. I mean, I learned an awful lot about a fuel injector, which is this incredibly precise instrument which couldn't exist without this new machinery. Parts of it are so precise that a virus couldn't fit through two pieces of metal. It's a fraction of a micron, hundredths of a thousandths of an inch. And that's something that someone like Ralph can do. I asked Ralph's boss, Tony Scalzitti - you know, I told him I've had some computer classes. I, you know, like to think of myself as, like, an amateur computer nerd and, you know...

JOFFE-WALT: You've told me more than once that you are a Mac tech.

DAVIDSON: Yeah, which, by the way, is not a good thing to tell people 'cause then they want you to give them Mac tech advice.

JOFFE-WALT: Right.

DAVIDSON: So I asked Tony, so, you know, I've got a BA. I have some computer skills. Like, would you hire me to do this job?

TONY SCALZITTI: No, of course not because you wouldn't know how to run this operation. You wouldn't understand the process if there's a problem. And the risk of having you be able to come up to speed with training would be a risk I wouldn't be willing to take.

DAVIDSON: What's the risk?

SCALZITTI: We could train you for six months and you don't get it.

JOFFE-WALT: (Laughter) Ouch, Adam.

DAVIDSON: And what I realized is it's not just book smarts. I mean, there's a lot of reading and learning, you know, just - and math you have to learn. But there's this level of skill that I don't think I could ever acquire. I mean, to be able to put some raw metal in a box, close the door, not see what's going on, just look at a screen that is just telling you the x-axis and the y-axis - I mean, not a picture, just numbers and letters - and somehow be able to picture in your mind what's happening inside this machine and figure out when something's going wrong, I just don't think I could ever acquire those skills. And, you know, Tony agreed with me (laughter) that I probably couldn't. He said about half the people he trains don't acquire those skills. And then, that's only part of the expense. What if they think I've got it, but it turns out I'm not quite as good as they thought I was.

YOUNG: A 7 or 8-micron wrong adjustment in this machine costs us a $25,000 Work Head Spindle. I mean...

DAVIDSON: Really?

YOUNG: Two seconds, we could lose $25,000.

DAVIDSON: In two seconds?

YOUNG: In two seconds.

SCALZITTI: That's why I wouldn't hire you.

(LAUGHTER)

DAVIDSON: 'Cause you think I'd probably do that.

SCALZITTI: On accident.

DAVIDSON: Yeah.

And that was what was amazing about the technological change we've seen in manufacturing. And by the way, I think this applies to a lot of other places as well. Technology at the high-end means you're more valuable. I mean, if you're going to invest in several million dollars of machinery, someone like Ralph, who knows how to operate and repair that machinery, is now way more valuable than any one worker was in the old world. Ralph really has bargaining power. He can really command a higher wage. But technology has the other side as well. It makes things incredibly simple, where workers become almost interchangeable automatons. You know, if there's a process that takes two minutes to learn, you haven't invested anything in that person. If that person, you know, shows up late one day or whatever, it's just very easy to dismiss them and just get someone else to replace them.

JOFFE-WALT: But I don't even think of us as having jobs like that in the United States anymore.

DAVIDSON: We've lost a lot of them. In just the last decade, we've gone from more than 18 million manufacturing jobs to around 12 million. So that's a third of the manufacturing jobs that were left. And Maddie's job is vulnerable.

How long does it take to learn this?

PARLIER: It takes, like, not even five minutes because it's - it does it for you. All you do is just put the piece in, push the clamps down, and push your finger.

DAVIDSON: The only reason I learned that she does have a job is that it's a little more expensive to get a machine to do what she does. I talked it over with Tony Scalzitti, her boss, and he said, sure, technologically, it's very easy to get a robotic arm to do what she does, but it costs around $100,000. So Maddie's cheaper, so Maddie keeps her job. But let's say, you know, there's some new enhancement in robot-arm technology and that arm becomes $50,000 instead of $100,000 or there's some factory in Mexico or China or something that figures out how to do this process much, much cheaper. You know, it's hard to see how Maddie keeps her job if she's not able to acquire those skills anytime soon.

Now, I wanted to understand how this all looks from the whole corporate level. So Standard Motor Products has more than a dozen factories all over the U.S. and Mexico and Poland. And I was surprised to learn that they're run out of Queens, N.Y., in a Long Island city just across the water from here by Larry Sills. He's the third generation. His dad ran the company, and his grandfather ran the company. And he's grooming his son, Eric, to take over the company when Larry's done. And they've had to lay people off over the years. And we asked them, what's that like?

LARRY SILLS: It's horrible. It's gut-wrenching. And we try because we are a family company. We're not a big Wall Street tycoon. We're a family company. We have a very strong loyalty to our people, and we think they feel the same back. So this is brutal.

JOFFE-WALT: So why does he do it? It's up to him, right? He can keep people. If it's so brutal, he should keep their jobs.

DAVIDSON: It's not up to him in a way. And let me just interject something because Larry would be very mad at me if I didn't say this. He said Maddie herself is a very valued worker. He can't guarantee she'll have a job for a long time, but he wants to keep her. And if this particular job goes away, he's going to do everything he can to keep her on staff. And I've spent a lot of time with this company. I came to really believe that they - frankly, if you are an investor, you would wish that they fired more people. They keep people on longer than other companies might because of that family-run ethic. But Standard Motor is family-run, but it's also a publicly traded company. That means, by law, Larry's job is to return value to his shareholders. He has to. And he says returning value to shareholders means creating auto parts at a quality and a price that people will actually buy. So he says he's not the one making the key decision.

SILLS: The decision is not made by us. The decision is made when the consumer walks into Wal-Mart and there's two products on the shelf. One is made in this country, and one of them is made in China. And the one in China is 50 percent cheaper than the one that's made here. And they choose the one that's made in China. That's where the decision is made.

DAVIDSON: And that's why Larry has had to do all sorts of things. I mean, until just four or five years ago, he was still making products in Queens, N.Y. Nobody makes, like, competitive manufactured goods like that in Queens, N.Y. But he - it was a family-run company. As he says, he grew up with the people who worked in the factory. He just didn't want to leave that business.

But he's had to, over the course of the last few decades, outsource more and more of his manufacturing to China. He, you know, opened factories in Puerto Rico and then Mexico and then Poland simply because there was no way to compete based on U.S.-made goods. He said he's had this experience when he's been forced to close down a factory in a politician's district, that the politician will come to him and - just really upset that he took jobs out of their district.

SILLS: Why did you leave? What could we have done to make you stay? I won't give you the names. What happened? What did we do wrong? I said, you didn't do anything wrong. There was no tax policy you could change. There was no - any kind of policy, it just wouldn't work. Don't waste your money on it. Don't give me a $2-an-hour rebate. Don't give me a real estate tax holiday or something. I'll take your money if you're going to give it to me, but it's not going to change the decision. And when I read things like this when they say, oh, we're going to waive the payroll tax for two years so now you're going to hire people, that's utter nonsense. You give me the money, I'll take it, but it's not going to change what I do.

DAVIDSON: Now, what was so striking about Maddie is she really knows all this. She knows that the old days are over. She knows that technology and low-wage workers in other countries are in a position to replace her someday. She knows that she really needs to go back to school. She really needs to get those skills or else she's not even going to be in a really good position and that means her kids aren't going to be in a good position. But she is a single mom, she has these two very sweet kids, and she doesn't know what to do.

PARLIER: I want to go back to school, but it's the time. If I want to go back, I have to go back on my time and I don't have time. You know, when I get off work, I go pick up my kids up, and that's it. My life revolves around my children.

DAVIDSON: What do you think education - like, if you don't get education - let's just say for whatever reason, you just never go back to school, what do you think that means for your future?

PARLIER: I'm always going to be where I am, I mean, to be honest.

DAVIDSON: So when you say I'll always be where I am, where are you?

PARLIER: I live with my parents because I can't afford anywhere else. And I have my kids. And I work. You know, factories are not bad - I love my job - but, you know, I'd love to be above an assembly one day. I'd love to be here in this office (laughter), you know. I mean...

JOFFE-WALT: What office were you in?

DAVIDSON: We were in the office with all the engineers, the highly trained engineers and high-level managers who ran the factory. And I know Maddie could do it. She's great at math. You know, she graduated high school with honors. She definitely has, you know, management potential, but there's so many, so many things she doesn't know. And the saddest thing is when she says if I don't get that skill, I'll always stay where I am, I mean, frankly, that's probably a too-optimistic assessment. That's wishful thinking. She doesn't get those skills, there's every reason to think she's just going to fall farther and farther behind. And I came to think this is one of the core challenges of American manufacturing, one of the core challenges of the American economy. How do we get people with low skill who this country used to need, used to have a lot of work for, how do we get those people to become the high-skill people? How does Maddie get to become Ralph?

JOFFE-WALT: What is the answer to that?

DAVIDSON: I've just decided, maybe because it makes me feel better, that Maddie's going to be OK. I mean, you just spend five minutes with her and you feel like this is someone who's going to be OK. She's going to figure it out. When her kids are a little older - they're only 2 and 4 now - she's going to - you know, they'll be in school, she'll go to school, she's going to figure it out. But there's this fundamental shift in how America works, that for all of American history, even before, you know, going back to the Mayflower, for all of American history, for most people, there's been sort of this wind at our back. There's been this enough economic growth, enough economic momentum that most people - obviously with major exceptions - but most people just were able to do better even if they had relatively low skills, even if they didn't have access to education. They were able to do better than their parents did and their kids could do even better than them. And for right now, it seems like that wind at the back, it's died down. And maybe even it's, for some people in America, it's a wind pushing them at their front. And I think that calls for major solutions. It's just a fundamental shift in how America works and I think we're just, you know, at the early stages of even trying to figure out how to deal with that.

(SOUNDBITE OF SONG, "LITTLE LIGHT")

RACHEL PLATTEN: (Singing) Looking for a little light to illuminate the truth in the stillness after everything is blown away. Life fades in the cuts and the struggles. I just need a light at the end of the tunnel.

DAVIDSON: In the years since I first went to Greenfield, life has changed a lot for Maddie. She and I have become quite close, and I've been in Greenfield a few times. And I know her whole family now, and she knows my whole family. And I can tell you that she's doing quite well. She left Standard Motors a couple years ago. The factory was far from her home, and she felt like she wasn't getting enough time with her kids. She tried to find a good situation closer to home, and that took a while. She had a couple rough years there where she was temping mostly in factories doing light assembly work.

But she now has an office job. She works at a place that sells forklifts, and she really likes it. Someone who learned about Maddie through the reporting I did reached out and sponsored her to get an online wedding planning course. And she found out it's really, really hard to start her own business.

For comments or questions, please email planetmoney@npr.org. We would love to hear from you. And NPR recommends you check out the NPR One app. It connects you to a stream of public radio news, stories and podcasts. There's great storytelling, rigorous reporting that informs, engages and surprises. Download NPR One from iTunes or Google Play. I'm Adam Davidson. Thank you for listening.

(SOUNDBITE OF SONG, "LITTLE LIGHT")

PLATTEN: (Singing) Looking for a little light to illuminate the truth in the stillness after everything is blown away. Life fades in the cuts and the struggles. I just need a light at the end of the tunnel, a little light to illuminate the truth in the stillness after everything is blown away. Life fades in the cuts and the struggles. I just need a light at the end of the tunnel, a little light to illuminate the truth in the stillness after everything is blown away. Life fades in the cuts and the struggles. I just need a light at the end of the tunnel.

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