Ford Reportedly to Reduce Workforce by 10 Percent

Christina Rogers at the Wall Street Journal: Ford Aims to Cut Global Workforce by Roughly 10%.

Ford Motor Co. aims to cut about 10% of its global workforce amid Chief Executive Officer Mark Fields's drive to boost profits and the auto maker's sliding stock price, according to people briefed on the plan.

The move comes as Ford targets $3 billion in cost reductions for 2017, a plan intended to improve profitability in 2018 even as U.S. auto sales plateau. Ford's share price has suffered during Mr. Fields's three-year tenure, and the company's market value has slipped far behind those of Tesla Inc. and General Motors Co.

The job cuts, expected to be outlined as early as this week, largely target salaried employees, these people said. It is unclear if the plan includes reductions in the hourly workforce at Ford's factories in the U.S. and abroad. Ford has 200,000 employees globally, half of which work in North America.

As Ryan Felton notes at Jalopnik, "while the company didn't confirm or deny the news to the WSJ, it said 'reducing costs and becoming as lean and efficient as possible' is key to Ford's growth. But to be clear, for now, Ford said it hasn't announced any new 'people efficiency' decision, which is Ford's dystopian word choice."

First, let me just offer my sympathies to anyone who is employed by Ford, or whose household income is partially or wholly reliant on a Ford job. To even weather the stress of the possibility of job loss is no small thing, especially when so much of the reporting on these sorts of stories talks about job numbers in the abstract, completely divorced from the lives of the people who fill those jobs.

Secondly, when we hear a CEO in a manufacturing company talk about "reducing costs and becoming as lean and efficient as possible," we know that it means one of two things (or both):

1. The "speedup," which is the ubiquitous corporate practice of not filling jobs when people leave and simply redistributing their work among remaining staff, who aren't compensated for the additional duties.

2. Automation, which continues to be the Employment Issue Whose Name Will Not Be Spoken, and for which most political leaders will not offer any meaningful solution (and often refuse to address, even when directly asked about it).

We now have a president who promised to "bring back jobs," saying it would be "so easy," but who has no plan for automation because he continues to promulgate the damnable lie that job losses in manufacturing are primarily attributable to outsourcing.

From a piece co-written by my former Shareblue colleague Anthony Reed and me:

America's manufacturing output is not in decline. To the contrary, it has grown by 17.6 percent since 2006. Efficiency has also increased: The output per worker has doubled since the 1990s.

In fact, if we needed the same number of workers today to produce at the same rate as the 1990s, we would have 20.9 million workers. Instead, we have 12.1 million doing the same amount of work. Nine million workers are no longer needed due to our efficiency. Suddenly, the real reason manufacturing jobs have disappeared becomes clear.

Which brings us back to automation.

Over the next four years, robots are expected to continue to render jobs superfluous — 7 million jobs will be lost and 2 million will be gained in the latest projections. Most of those 2 million jobs will not be filled by the same people who lost the other jobs, as the skills required to create and upkeep robots differ dramatically from the skills that the robots replace.

These numbers are completely independent from outsourcing and are clearly a much more significant problem for unemployment. Taking into account the jobs we have already lost from automation, that is 16 million jobs that are no longer required, or roughly 8 times the number of jobs lost to outsourcing.

And here is where Trump's misdirection on the source of job losses becomes so deeply troubling.

Protectionism does not inoculate against automation. Trump can prevent jobs from leaving the country (at a high cost), but he cannot turn back the clock to a time where a factory sustained hundreds or thousands of employees to manufacture goods now manufactured instead by automated processes.

The choice for factories is not between outsourcing and keeping U.S. jobs. It is between outsourcing and automation.

Both are competitive business decisions, and Trump's proposals to levy fines for outsourcing will tilt factories towards automation, thus hastening the job losses due to robotics.

The facts are clear. And yet Trump persists in making promises regarding jobs that he cannot possibly keep, because most of the jobs he is vowing to restore did not go away overseas; they went away altogether.

Every time he told voters that he would "bring jobs back to America," he was telling a lie. And he told that lie because unemployment resulting from redundancy due to automation is a much more difficult problem to solve.

So here we are, with potentially thousands of Ford workers at risk of losing their jobs, and a president with no plan to do anything about it.

Automation is everywhere: Manufacturing, retail, restaurants, office administration, self-checkouts at the grocery store, self-driving vehicles on the roads. Automated garbage collection and street sweeping pilot programs are being tested across the nation. Drone deliveries are coming.

If you've visited a construction site lately, you may have seen field clearances and leveling being done by a grounded drone within marked boundaries—a sort of large-scale Roomba for the great outdoors.

We're reaching a point at which automation is accelerating so quickly, and the cost of materials for production via 3-D printing (as one example) is decelerating so quickly, that we could begin to envision utopian economic models built around a universal basic income, freeing people to use their talents to hasten technological advancements and healthcare solutions, or to create art and comfort.

Instead, we are ignoring both the devastating effects and boundless potential of automation, necessarily eliciting visions of dystopian economic models built around the continued consolidation of wealth among a very few who ruthlessly exploit everyone else, as we scrabble for scraps.

That doesn't have to be our future. But it will be, so long as we are led by people who can't—or won't—envision anything else.