THE TWO-TIER PAY SYSTEM Name Institution Course Date Responses to Discussion Questions Response 1 The renewed growth in the job is partly attributable to the introduction of the two-tier pay system as well as an increase in the number of vehicles produced. A huge amount of money is saved for the Automobile industry due to a reduction in the labor cost per car. General Motors can save up to $450 per car of the total labor cost because of the two-tier wage system. The US automakers are able to compete favorably in the global market due to increased reduction in labor costs of around $72M annually (Mateus 2014). Response 2 I think Mr. Marchionne says so because he believes this type of pay system in the future will cause more harm than good. It is likely to This idea is supported by Scott Houldieson a former secretary of UAW Locus 55. Besides companies offer pressures to eliminate this system in order to lower labor cost to reflect those of competitors in the market. Workers themselves are looking for companies that are paying well compared to others. This raises turnover rates thus forcing companies to adjust wage system to retain highly skilled employees who move away in search of a high salary. Second tier workers cannot drive decent cars buy a home or educate their children due to low pay. References Mateus A. M. (2014). The Globalization of Automobile Markets. Skeel Jr D. A. (2015). From Chrysler and General Motors to Detroit. Widener LJ 24 121. Vlasic B. I. L. L. (2010). Detroit Goes From Gloom to Economic Bright Spot. The New York Times A1. [...]
Unit IV Case Study Read “Your Turn: Two-tier Wages” on pp. 242-243 and compose a paper using your responses to the questions following the Case Study on p. 243. Your paper should consist of at least two pages, and all citations and references should be in APA format.