White-Collar Jobs Also Exiting U.S.

From Fort Worth Star Telegram

FORT WORTH, Texas — Rows of engraved faces stare from plaques on the Inventors Wall. These are the faces of engineers who have made design breakthroughs used on some of the world’s most popular cars and trucks. All of the engineers work for Delphi, a Michigan company, at its Mexico Technical Center.

The plaques are here largely because Delphi has thousands of assembly-line workers putting together car parts at this location.

As manufacturing jobs moved out of the U.S. over the past decade — whether across the border to Juarez or across the ocean to Beijing — many political leaders soothed the nerves of an anxious work force by assuring that white-collar jobs were staying put.

But increasingly, companies that have moved their manufacturing plants out of the U.S. are shipping offshore some of the engineering and research and development work.

“The manufacturing jobs brought more white-collar jobs along with them than most people suspected,” said Tom Fullerton, professor of economics at the University of Texas at El Paso.

It’s a natural progression for research and development jobs to follow manufacturing plants, experts say, because much of the design work is geared toward improving the assembly process.

Also, companies become comfortable with a foreign location after having moved a portion of their work there. A study by A.T. Kearney, a business consulting firm specializing in outsourcing, found that China is listed as a favored potential offshoring site by many companies because they already have plants there.

Paul Almeida, president of the AFL-CIO’s Department for Professional Employees, believes that research and development jobs will continue moving to offshore manufacturing sites.

“They keep saying we’ll innovate new jobs. Where? At the factory in the foreign country is where that’s going to happen,” he said.

Some economists say such concerns are overblown. The loss of white-collar jobs has been minimal compared with the overall size of the workforce, said Bernard Weinstein, director of the University of North Texas Center for Economic Development and Research.

“It’s a drop in the bucket,” Weinstein said, then corrected himself. “It’s actually a drop in the drop in the bucket.”

In Juarez, about 1,700 engineers and design experts work at Delphi’s technical center. Delphi’s nearby maquiladora jobs helped pave the way for the center, as did the company’s desire to expand its engineering presence to locations where its customer base was growing.

Less than half-a-mile south of the Rio Grande, professionals at the Delphi center design and test parts for next-generation BMWs, Chevrolets, Toyotas and Hummers.

A row of clocks on one design-room wall hints at the scope of the work, tracking the time in Michigan, India, Brazil, Tokyo and China.

Delphi has offices worldwide, but its largest research and design facility outside the U.S. is in Juarez. About 80 percent of the experts in the technical center are Mexican nationals, recruited from throughout the country.

On the third floor is the Inventors Wall, where dozens of gold plaques boast of the center’s accomplishments, including 76 patents and 10 trade secrets. Mexican engineers from this center travel to China and other Delphi plants around the world to pass along their expertise.

“I’m very proud of that wall,” human resources director and Juarez native Alberto Vega said. “It’s an indicator of all the technology coming out of Mexico.”

The jobs pay good money by Mexican standards, and the pay gap with the U.S. shrinks as an engineer’s expertise increases, Vega said.

A line operator with a couple of years’ experience on one of Delphi’s nearby assembly lines earns the equivalent of about $4,800 a year, benefits included. An entry-level engineer can earn four times that amount in pay and perks, and top-level engineers can pull in $90,000, Vega said.

The Delphi center has become so successful that more than 350 El Paso residents drive into Mexico every day to work here, including company spokesman Michael Hissan.

But Hissan said those who would complain that Delphi is abandoning the U.S. should consider that the company still has 50,000 employees north of the border, and that its manufacturing plants in Mexico purchased nearly $380 million in parts from Texas suppliers last year.

In China, Texas Christian University graduate Arthur Zhang became the financial controller for one of the world’s largest IBM plants. Almost 4,000 people work at the plant, which has an annual output worth several billion dollars. And Zhang is only 30.

There was a time when a foreign student like Zhang would have done anything to stay in the U.S. after earning an MBA here. But now many Chinese students prefer to return home, said John Burgoyne, a member of TCU’s International Board of Visitors.

Burgoyne, who oversaw IBM’s China operations before retiring to Weatherford, helped Zhang — and a few other students — make contact with IBM. “They see more opportunity in China right now than they do in the United States,” Burgoyne said.

The IBM plant makes most of the laptop computers IBM sells worldwide, Zhang said. Operations in North Carolina, Mexico and Scotland have been consolidated there in recent years, he said.

Almost 800 of the jobs are white-collar — engineering, finance, information technology and human resources, Zhang said. The current trend has companies like IBM moving mostly low-end research and development and information technology jobs to China, he said.

“A lot of multinationals are here,” Zhang said, “looking for talent to fill a lot of their jobs.”

In fact, Zhang recently left IBM to work for another U.S. corporation with its regional headquarters in Hong Kong, where his wife works.

Just as the IBM job helped Zhang return home, Delphi’s 15 facilities in Juarez have kept some locals from leaving the region.

Vega, the human resources director, grew up playing near the cotton fields that once grew where the design center now stands, and he always planned to leave the region to find a good-paying job.

“That’s what everybody thinks here — you must leave,” he said. “But companies like Delphi have made it possible to stay.”

_______________________________________

Click here to view the rest of today’s headlines.