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HomeMy WebLinkAboutMINUTES - 10061987 - I.O.3 TO� BOARD OF SUPERVISORS FROM: • INTERNAL OPERATIONS COMMITTEE September 28, 1987 Costa DATE County' s• Ability to Require the' Use of American- SUBJECT: Manufactured Products in Construction Projects SPECIFIC REQUEST(S) OR RECOMMENDATIONS) & BACKGROUND AND JUSTIFICATION RECOMMENDATIONS: 1 . Request County Counsel to review court cases brought to our attention by 'staff from Congressman Miller' s office, and advise our Committee of their application. to California. 2 . .. Request County Counsel to, advise our Committee on what actions would be necessary -in California to permit the implementation of" a "buy-American" policy similar to that . which has apparently been approved by the courts in New Jersey and other states. 3 . Authorize our Committee to meet with the Contra Costa Council, industrial associations. in the County, Chambers of Commerce; and labor unions, to determine industry and union interest in forming an industry-union-government economic development task force which could explore ways in which the private sector, labor, and local government could cooperate in bringing more jobs to Contra Costa County and generally improving the economic outlook for the County. BACKGROUND: On September 1, 1987, the ..Board of Supervisors authorized our- Committee to meet. with specified Congressional and legislative staff to discuss how we could implement law . or policies in this County which would allow the County to require that American-made products be used in major cosntruction projects in the County. While we invited our Congressional and legislative delegations to meet with us, only Congressman Miller' s office was represented at our meeting on- September 28. We received an" excellent background briefing from Louis Roseman, Instructor at Diablo Valley College, on the employment prospects in this County over the next several years, and on several things other, states .. are doing to. encourage economic growth in their; states. A copy of these newspaper clippings are attached. - Mr. Roseman also provided some thoughts on things the County can do' to encourage economic growth in the County. . ,That information is . also attached. CONTINUED ON ATTACHMENT:, _X YES SIGNATURE RECOMMENDATION OF COUNTY ,ADMINISTRATOR RECOMMENDATION OF BOARD COMMITTEE .�_ APPROVE OTHER SIGNATURE s : Nancy C. anden Tom Torlakson v ACTION OF BOARD ON VOctober 6, 1987 APPROVED AS RECOMMENDED OTHER VOTE OF SUPERVISORS I HEREBY CERT1FY .THAT THIS 1S A TRUE,:' UNANIMOUS (ABSENT rj10 CORRECT COPY OF AN ACTION TAKEN AYES: NOES: AND ENTERED ON THE MINUTES.OF THE' BOARD ABSENT: ABSTAIN: OF SUPERVISORS ON THE.bATE SHOWN. CC: Listed on. Pace 2 ATTESTED PHIL BATCHELOR, CLERK OF THE BOARD OF SUPERVISORS AND COUNTY ADMINISTRATOR M382/7-83 BY _,DEPUTY Page 2 Lynelle- Johnson of Congressman Miller' s Office indicated that New Jersey, ` and at least six other states, have implemented elements of a "buy-American" policy which have,, apparently, withstood judicial review. Ms. ' Johnson =recommended that we consider State legislation which :would be acceptable in light . of a California Supreme Court decision striking down prior "buy-American" _. legislation' in this State, since such , legislation has . been successful '.elsewhere. We, believe County.. Counsel needs to review the information made available by Congressman Miller.' s Of report and ort back . to our Committee on what appears to ',be,be feasible. ; In order to . implement ',some of the suggestions :'made -.by Mr.', Roseman, we have suggested exploring „an economic development task force that would allow industry, labor unions, and local government to jointly explore ways .in which we could stimulate the economy• in this County.. I. • i, • , cc: 'County Administrator .County Counsel`; Congressman. Miller' s Office Steve Roberti Central Labor. Council_ (via CAO) Contra Costa Council (via CAO) • Industrial Associations (via CAO) ' t. Chambers of- `Commerce (via CAO) Lou. Roseman, DVC, (via CAO) i z INVESTMENT GOALS MAXIMIZATION OF PROFITS,DIVIDENDS, INTEREST, AND VALUE OF SHARES, PLANT & REAL ESTATE 3 RESULTS OF INVESTMENT GOALS AFFECTING MANUFACTURING JOBS I ., MULTINATIONAL INVESTMENT NEGATIVE RESULTS A) LOSS OF U-S. JOBS B) INCREASED IMPORTS LEADING TO UNFAVORABLE BALANCE OF TRADE C) INCREASED FOREIGN CONTENT OF 'AMERICAN MADE' GOODS POSSIBLE REMEDIES FEDERAL A) PROMOTE JOINT VENTURES IN THE U.S_ B) ENCOURAGE FOREIGN INVESTMENT IN U.S. INDUSTRY RAtHER THAN IN STOCKS C) INCENTIVES TO INVREASE AUTOMATION & ROBOTICS D) LIMIT EXPORT OF CAPITAL E) INCREASE TARIFFS F) NEGOTIATE QUOTAS& VOLUNTARY AGREEMENTS TO INCREASE EXPORTS STATE . A) REPEAL UNITARY TAX TO INCREASE INVESTMENT IN STATE (LEG. PASSED ) B) INVENTIVE PROGRAMS---TAX, TRANSPORTATION, RESEARCH & . DEVELOPMENT COUNTY A) SHORT TERM FEE & TAX FORGIVENESS B) PRESS FOR BART EXTENSION C) ENTERPRISE ZONE PROMOTION D) TRAINING PROGRAMS TO PROVIDE NEEDE SKILLS E) ENCOURAGE STATE & NATIONAL LEGISLATORS TO SPONSOR LEGISLATION 20 INVESTMENT EXTERNAL TO ORIGINAL INDUSTRY NEGATIVE RESULTS A) INVESTMENT IN FINANCE & HIGH GROWTH FIELDS B) LOSS OF INDUSTRIAL JOBS C) ATROPHY OF LOW PROFIT INDUSTRIES D) WEAKENING OF U.S. INDUSTRIAL STRENGTH AND SELF RELIANCE E) INCREASE IN STOCK MARKET & HIGH RISK, SPECULATIVE INVESTMENT BOSSIBLE REMEDIES DERAL A) PROVIDE TAX INCENTIVES FOR ,REINVESTMENT IN SAME­INDUSTRY B) REDUCE TAXES. FOR .LOW PROFIT INDUSTRIES- C) C) S,USID_IES FOR: :RESEARCHDEVELOPMENT,,.,:. t WAGES .. PURCHASE OR :LEASF. _ ,OF AUTOMATED & ROBOTIC EQUIPMENT D) NATIONALIZE WITHERING VITAL INDUSTRY E) OFFER PROFIT SHARING INCENTIVES TO EMPLOYEES STATE. AT`ASSIST FEDERAL GOVERNMENT IN A & B ABOVE B) IMPROVE INFRA-STRUCTURE TO ATTRACT INDUSTRY(TRANSPORTATION, SEWAGE ENVIRONMENTAL CONTROL) COUNTY A) SPONSOR MANAGEMENT IMPROVEMENT WORKSHOPS & COURSES AT COMMUNITY COLLEGES B)HELP 'INDUSTRY REDUCE WASTE & INEFFICIENCY C) SPONSOR & ENCOURAGE FORMATION OF SMALL INDUSTRIAL FIRMS aL9 SNOlsoa.CO&T, DV8V aONnOS 060111 -.0:0z:'.E t t �ZN[1Q0 dW� SZN�Q Sal �8'LZ+ 000 t06 000'SO� N0I1VIfld0d 109+ Offiff 000€Z RNE Ni Scor IVIOI' sqo[ Tego,4 jo % WES+ OZ9'6H 0SC16 ZIvZ�1 'dq�saloH� 'SaIlIqIZQ 'NOINIUSNUI 'NOI MMISNO $t+ %S'Z£ %S'sZ sgor gVios ao % saor DIMS , %6'-h ' %6•01 8• TT sgor ,'IKsol dA % %W, Oulu asvadoa(i �aS�i�ONI 5002 5862 5002 - 5862 )UMOOD VISOR V�IzNoa f 1 , j ID17700 .TZ77VA 07a"vIQ .LdyQ EDIX01voiz lUvlw2S021 1107 Aff u9zzljw8l15 'Sdnop IVANNUTAN3 I SbNnSN00`MOVI `SSAisnB 1N3WU3A09 WOd3 NOIMN33UR 30 1SISN00 Ol•.`A1N(100. 30 ANdOl3A30 DIWON003 403. 30403 .MI HSIlOVIS3 (a .`ONIsnOH 1SOO .MOI '.a' 6 SS3NIS(18 ALIO d3NNI AiMnwW00 3H1 30' AWON003 Ol 31ngidiN00 .01 SOl3I3 SSMisnB 'IIJUd -HOIH 3H03d (0 a'ImirmaK a iv aAOSK aQVW SNOIZSa00nS axs 40 XNKW W _ NOISNKaXa 'I` oAxva QNK 7,ZIASON07 NO QaSV9 SaAIINaONI XVI (K )isim :lv- swisaANI '8 SaINKaw00 Sind SZNaWlsaANI aAIIVInOaas (0 aOQa aAIZIiaawoo do ssoi Ni SIMSaN GIN NO SISVEcTWa QaanQas (a SaINISOGNI B SaINVaW00 ONINI'IOaQ ONINOQNUEV QNK .ONI 13W„ (V sIT, ZnsaAz ,z,�� �� . SZIdOdd Mds DIMS . NO SIS.VHaRH l 3 ._EMPHASIS ON SHORT . TERM PROFITS NEGAT2VE RESULTS A) 'MILKING' AND ABANDONING. DECLINING. COMPANIES & INDUSTRIES B) REDUCED EMPHASIS ON R&D RESULTS IN LOSS 'OF COMPETITIVE EDGE C) SPECULATIVE INVESTMENTS PUTS COMPANIES & INVESTORS AT RISK POSSIBLE REMEDIES FEDERAL, STATE & COUNTY A) TAX INCENTIVES BASED ON LONGEVITY AND PAYROLL EXPANSION B) MANY OF THE SUGGESTIONS MADE ABOVE ARE APPLICABLE. C) REQUIRE HIGH PROFIT BUSINESS FIELDS TO CONTRIBUTE TO ECONOMY OF THE COMMUNITY i .e. LOW COST HOUSING, INNER CITY BUSINESS D) ESTABLISH TASK FORCE FOR ECONOMIC DEVELOPMENT' OF COUNTY, TO CONSIST OF REPREENTATION FROM GOVERNMENT, BUSINESS, LABOR,CONSUMERS & ENVIRONMENTAL GROUPS. SUBMITTED BY LOU ROSEMAN ECONOMICS DEPT. DIABLO VALLEY COLLEGE i i i EMPLOYMENT—POPULATION TRENDS CONTRA COSTA COUNTY 1985 - 2005 1985 2005 ° o INCREASE DECREASE: .......... _ MANUFACTURING JOBS 28 ,160 41, 410 +47% $ of TOTAL JOBS 11 .89 10.9% y-.9% SERVICE JOBS 67,220 1221300 4210 % OF TOTAL JOBS 28.5% 32.5% +4% . CONSTRUCTION, TRANSPORTATION, .UTILITIES, WHOLESALE, RETAIL 97,350 149, 620 +53 .7o % of total jobs 41% 39.5% .-1 .5% TOTAL JOBS IN COUNTY 236,900 379400 40% POPULATION 705,000 901,000 +27 ,H0 RESIDENTS EMPIGE=Dfl COUNTY 113,290 114,0 0 0 32% 23% -9% SOURCE: &BAG 'PROJECTIONS 87' iEVIGONOMY ROUNDUP Joh growth in Conga Costa Alameda and Contra Costa counties will gain 234;000 new jobs through the turn of the century, / reflecting typical growth in,Sun Belt suburbs;"a private research report concludes: Overall,some 37 percent of job growth be- tweeri now and the year 2000 is expected to be fo- cused in just 46 counties,across the.nation, NPA Data Services.Inc. of Washington,D.C. reports. The total U.S.job growth is expected to.be . 25.1 million between 1987 and the Year 2000, with 9.4 million of those jobs concentrated in the 46 fastest rising counties,according,to the study,"Key Indicators of County Growth." . The economic data and research firm said the 46 counties will all have job increases of 100,000 or more,led by Los Angeles,which is expected to.' gain.some 805,000 new jobs in that period. Contra Costa will gain:113,000 new jobs and Alameda County 121,000,according to the report. Santa Clara will be the bigwinner in the Bay Area,netting 342,000 jobs,while San Francisco will _ ain 126,000. S• - G CL L Augustjobless rate. declines.' The state Employment Development Depart- ' REA 11z�j ment reported that August unemployment figures VNIEP`OY ENT declined in six Bay Area counties from the previ- ous month. ..county, 8/87 7/87 8/86 Last month's unemployment rate for Alameda Alameda 4.96/o 5.30/x;:5,8% and Contra Costa counties was 4.8 percent;a sea- Contra Costa 4.7 5.2 i-5 3 sonal decline from the July figure of.5.3 percent..: ;', Marin 3.0 3.4`'r`3:a A year.ago,.the two county August jobless rate.was 5.6 percent Napa 4.2' 4.9'"' 5.6`' .. For the Bay Area overall,seasonal hiring in- San Francisco 41 14.9 ..._5.7 creased in food processing and,construction, and retail and wholesale trade showed some growth. San Mateo 3:1 3.5 3.8. But the growth was offset by typical declines in Santa Clara 4.2. 4.7 government payroll, and an August trade dispute Solana 5.4 6.3 `'=";6.1 l involving hospital employees also.depressed the ;'employment level. Sonoma 4.2 4.9 5.1 EdUCatlOri reported the biggest loss.as pay- Solace.- 5tate•Employinen►Develppment Department rolls reached their annual low following the com- „t. .- nletion of summer sessions. cc ven ure • Y/Z�� ' C ",viahe.. rin SAN FRANCISCO — Chevron ducts throughout the U.S. mito. Chemical Co., a subsidiary of Chev- The 50-50 partners intend to The joint venture grew out of – Chemical Corp. and Sumitomo Chemical market existing and future com= ..several years of clbsc ties between- Company Limited of Japan have pounds through the new company the two companies in the p- agreed in principle to form a joint beginning early 1988. ment of agricultural cheemicamicals. ; lop and The new comp venture company. to deveany will employ which include Spotless, Danitol,•;., Su- market agricultural chemical pro- . workers from both Chevron and Su Prunit and Sumagic. PAGE 37 TUESDAY,,'SEPTEMBER 8, 1987 j Tr T i TjM1 H�h ET, 4 ©.1987:;DOW;Jones &,°:Com vny, Inc,stll Rt ri�ta Reserved �' d. F'orltconomxsts tl evlse r IVleasures of `c noetic OU,Eput Y' ­EvGErrs'Gnxcsorr ' Staff Reporter of TxE WwLuSTxEErJ0 RNAL' { IV F.COUNTRIES,CAN' Ts their economic growth with the ,familiar;Lcalculation known as,gross national,product,,and;if states can,make similar estimates of"their'output, why.can't.,:cities do;it,too?Population,is the usual way urban areas meas- `-,.',, ; ;use growth. Building-.permits.and•retail sales are other.indicators. ; 1. ,.Why.not­aa gross..city,;product, ineasurin the value of goods and .- Services o.comp ement the .other, figure , , e het6, director.,of:Arizona.` S�j� Jnivprsit;'K Fco-.` 'nomic utlook en er, has r.aleizlate a GCP for Glendale, Ariz a t unit o 136 000 on the western ou s irtcT"s o oenlx.Compan, PaMM apasa- ,.possible industria. site' and bond-rating firms osessin t e—seri" wort mess t commu' its find,the G P figure'useful; le says a cu ating a spial- �c !._pro uct is complicated by the.small:number: industrial sectors and:low employment levels, u Mr.McPheters says the.idea,works in Glendale:. because.,the,city._has.1rbughly.,the .same..indus trial mix as Phoenix-and the restof.Marieopa:County,which in turn .:. accounts for two-thirds of.Arizona's economic activity.For exz%mple, more than half of Arizona's manufacturing is in high technology;and the`same is: true'in.Glendale ',' tt The-professar.took the output per worker:.for various industries e, ;-at the state level and appliedthe figures to:Glendale'workers in the =same industries:"It holds up pretty well in;a state like ours because iArizona is.one.of,the'Aop,&e urbanized!`states in.the country.' 3:One'"of'a,,handful of:other GCP.,,examples:is,in,Texas; where. r Baylor. University's economic-forecasting.service produces-a,gross product figure. for each bf`the state's 28':metropolitan areas and-all; l54 counties. Ray Perryman,;•director.of-,:the forecasting service, says the concept,is valid only;if the compuerized model.of the state economy :which;serves, as the base for,figuring output in smaller areas, ,is continually updated as 'economic conditions change "Ia,,a, lot of states,,.the:econometric'model. was somebody's doctoral'dissertation 10 years ago; and it's"sat on .the shelf since thea;" he cautions � i By--Mr: McPheters's reckoning,"Gtendate's�GCP, adjusted fot inflation,,.) 190 last year:40 55%,frorn;:.1983 to I98G, { M d ` : w 14 tt4 �' a'. .• .`���' '- vs..., v C V'.�� G ,C uj. O a) G O O.O «5 w U„su0. 4) O. .,.. •� vz. c. Lk' " UAE y.p7 GO" K� cts Cs, ti ' cab � G O `° a] O Cn SV-+��y G ...,D �. a), .�",. «3 a.+ w "•L V !!'J W. J v� O w *^' .',.pR";O.•��+ "''1:t ca G a) G) .Q G W w w .. s... 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Incentives for car buyers are ry ,; of currently narrow 3ati now,a 12 month a year affair:'Yet jurisdictions and for unstinting even the latest, l.9'percent `; FSI UAW acceptance•.of team-based financing is nit enough to shake , . `r� fi , :,organization of the°sort that. General Motors'4siuggtshness. ; ' '"' _ has been so.sizccessful in the GM- '1n fact;.the once great firm has fi � ' � �r� ; � Toyota.joint venture.. become a sort of national I.: �A wage:package should emba?assment,a symbol of our f` include a potential gainsharing inability to compete h the'Soviets,_we should ask s l.incentive..of 25 percent;based I suggest we make the-"`-­ t Japan to send,So�cliiro Harada to ' j;,first upon quality improvement revitatixatcon:of GM a national' act as GM's'chairman for the tr and second upon productivity priority My plan may-not be., nextfive years } improvement.,Finally,over a five- literaily plausible,but it dead- 'o Perks All'officers:6661d' ,i Year period:GM should offer a,. seriously address6svthe sorts of be.given`new Honda Acuras, !3, one-,time, -to' -$20,000 per,- ­, problems.that GM,' ..: em to ee retraining of which rather-,than the'traditiohal,GM. p y g p { ,and countless.ather former vehicles.All officer bonuses i would add up to about$- billion), leading American,firms,face," h � to boldly;shift its emphasis.` e Carillon.<Detroit,is an aughYto be based 75,percent ,S ' ` { 'from."hardware"to"humans." on relative quality improvement island.;While recently'makirig the yls a-vis all competrtors, V, a"Half a Million in 1992." 45 minute drive from, The firm should declare its '` ' domestic and•foteign ': { Detroit airport to downtown,I -strate c intent to sell 500,000 . counted onl :three Japanese:..:: °Design. Ford's„Taurus has, 4 ' been a smashin deli success cars in Japan by 1992.(it sells- cars:.on the road This is not the g r 1,$00 today).”! ' real world in the United.States,bufit.,is essentially a knock off;of sleek�,' *Special consultant.One {For instance;GM's market ; "European cora models To.instill share.in-trend-setting-California u. "victim"of this grand scheme is.40 ercent below its national more boldness and creativityfin would surely be current market share.) : Detroit'GM's`new.chief s. .>. '� 'chairman Roger Smith.I propose I propose that GM get out of designer position should report he be''retained,`with"a salary of directly to the chairman of,the-,,,.. $1 million,per year: town: Move the headquarters of... 'board;the`post would be shared' However,he would be the o,!th ,large-car division v San by Calvin Klein and equally :placed on,a rotating assignment, Diego,'the large-car division to ,design-conscious Apple; _ with six months as sales Dallas,and transport a trimmed-down corporate Computer.founder Steve Jobs' manager 4n,a:SoutherilCalifornia headquarters about 250 ,`, - ;Roth should,have seats on, _ :Chevrolet-Toyota dealership; instead of today's 6,000 to' 1 the board. To acknowledge:the , -then six months at the same. Atlanta. role of women in car dealership's service e Organization.Instead of=` Purchasing decisions,more than department the U.S:imposing afive-year' half the'design;department These-ideas"may sound i. sanction against Toshiba for its-_'. ` should be staffed by{women by outrageous,but whenI recently.' selling machining equipment to,.., 092 presented"them`to an,audience t .•.r;29:, , ; 'e Customers'Three'dealers,- that included several dozen GM- with customer`.wtWaction_scores real people {middle. inthe top,l percent•of'all`GM, managers and UAW reps),they dealers'(as measured by a third'" responded with cheers:", party),•should be given rotating`''... ::GM`s workers acknowledge seats on the board.` the need fur audacious steps to Each'Generai Motors resuscitate the free-world's manager,starting with the largest,industrial concern.- E chairman,must be required to_,.; When will GM's tap dogs work one.week per year m a local catch on? .` A. . dealership. *Workers.,,General Motors: ;= {"Tom-Peters is a.- -should offer a_lifetime-.. r management expert and:the ;,employment guarantee' to 85 , author..of"In.Search_of percent of its.work force, m Excellence"and co-author of"A t:returri far cartiplete elimination ,., Passion far Excellence. ' for certain aerospace craftsmen is so keen / that McDonnell Douglas Corp., Rockwell International Corp. and Northrop Corp. sometimes pirate workers from each 50 t L other.-Iii,"other. pars of the country, com- panies are enforcing mandatory overtime Workers Wanted RICO production•schedules and taking Y�" orkers YI anted wworketswill,few el'Ahan-desiredskills— trerids,.that'some economists say could re- ArowinbCr Shortage educe productivity WagYe Ga.i>iis 1111odest � � , Of v ) But, s0_ �risnn ,,_the la r shorty e Of Skilled Craftsmen i has s arked cin�� mnc3e. gins o arsMUIOU941 despera e for certain Rby . ;ns,some employers would rather 'roubles Some Firms along without a full work force"than raise wages high enough -to attract..needed workers,.Mr:Shaiken says.-- ---n!'.__. U.S. Industry Could Suffer; "What we're seeing•is the legacy of the But NVageS of Machinists, Wt.economic, recession and the ongoing pressure'.of foreign competition: Many Others Have Risen Little companies have chosen to ignore issues of supply and demand for fear that higher Ia- bor costs will make it more difficult;toG compete,' he adds Tho,threat of foreign Young People Shun Factories' :{, competition�IstYai�r`eaI 'factor, but it n ,quickly'becoming is an excuse for not raising r+ "wages. Companies' obsession with for By CiiNST>ntcl Mizcarr r },.-° -' , 5+a11etc fturte r uf'r+u Wwc.,-STtcErr rovANwL Costs Coombe creating an even more se- When Thomas Kelly learned that 97 vere shortage craftsmen at a nearby•plant were being In addition,unions a e"ffi' kin 'ob secu- c , tatting ro ret , not hi her a _016-IF-too-1 bar Mining lems lead been solved. Within hours the issue.T e h ac inists union,worrie about human-resources manager of Electric Boat To—sing jobs rfoe"'" an 5taln and Japan, Co. in Groton,Conn.,was on the phone,ar j. hasn't ressed for pay increases ' qe ranging to interview the workers, F. e' a e s or age worsens, however, % But what began to a routine recruiting wage pressures May slowly,build up. call quickly turned, to Mr. Kelly'samaze ,,Work-Force Cutbacks ment, into a iii throat battle.,against 50 The existence of any sort of labor short :h otherr )eines also ea er to em to the age seems,hard to fathom while many ca�r war 1s_ Hr had hr]ped to hire 30 macin rations,°including auto companies and. fists but got only two. steeMfters, continue to restructure their --79e­ve,j_VI3%Mr. Helly had to ;:operations.They have cut the manufactur-{• scram e o m recruits for Electric Boat, Ing work force by'�i a o"B_7- nit fion last the General Dynamics Corp. unit,that :i" ton in ugust builds the Navy's Trident missile subma o�ru�ITIp � w o—' renes: Ig thy,e past, when the huge ship 1,0_11 frons 4.5 mi ion six years ear rer, ut builder needed niore blue-collar workers, ie wiem oy ruc 'on is a "we just opened the front door and thou- high 11.2%of;the work force,,much.steeper sands of people flocked in,"he sa s.1�0,, o 3 than the 6/a national rate. it talks recrut io semi=nars, nationa 1 - But`aggregate employment numbers vertisin„,, higher pay and exe> ive-st vee t St � aren't broken down into specific figures for ' perqu—is-it•es ust to hire in job a, hcarits. skilled blue-collar workers,who hold one of 111 1'Cilt to F'Ifieiency ever our ac ai v"obs.Moreover,some of In the past year, much • ttenti0n has - �s iQ�'$ are C(lnr r nfrafpd in Nam been focus e on tie growing scarcity of Eo`laird and the mid-Atlantic states. serviccrwr+r•ers fot•e' :c is hotels and "`c1e• jDJWL1.s,%ess in 'some cl li`es has s ores But a tar niory s+-rii)LL, labor s tort slipped below 41/o,the level that some econ- ige is eni r i for skilled blue-collar amistsnow const er"full employment"af- 1. c.ra f tsrr e0_ ran iii from mac rots a d ter all"Ving for such "frictional unem- t eC ricin is to s n 1 0_i ders an k „ ploymeni as People voluntarily moving ' layers That shortfall, �i e•+}a ace compa -from one lob to another. Ines, e c ri,e co . l +ons ruc ion An unemployment rate that dips below concerns, could dama ge Anierican i's u, that level indicates more jogs available try's efficiency nd Could i:ncoura;;e_ i re than qualified workers to fill them.Accord. f ariu ac urers to move operations tolor. Ing to government statistics, one of five Ug-5 gii nations where workers are lents ul. malar metrcipolltan areas ess ra es tit trtu gal tri t c ieciuse FUled Nut,rol I a•c Ea f tsmen r e.uelite. ary ,� fgg-f-r rrnri.�Ijr, 111f. rultiQ11, df' ; Electric Boat, for example, currently ;t Tense ilndusti , more< � s : has more than 300 job openings for ma worry (fiat„ the U S,_Couldn't regpamr k chinists, pipe fitters, welders and other V cloy to an international crisis. skilled craftsmen, some,of whom care be """"t#e re acing a situasituation where, in 10' t u'`. Please.Turn to P,a,tTe 1 Column 1 years, we won't have anyone who know 1100 tO reDair Twarrunu;II: cut t p jaioh 1w3. tM1 inti 0 narts or h tilrl iI ;iirf lane cmc nQ fro�in_;tc i,i i „ sa s Harle Shxiken, a la or economist at t isniversi'ty aTCa.l�ifor- 11iai iii SMn Di(,LL If tfi113ues to spread, he adc s "American industry 4th i+_left-with mndern f;0_tnriPti at Ju�� uc�tuucio. uic..ucicuoc:uwu�pyy��;�,.: - ,says it,is "genuinely concerned". that the. grams for pipe'fitters'fell 30% to 11,200, vacancies could limit its ability to meet. and those in bricklayer.,programs plunged production schedules. 53% to 4,000. -Yet_manufacturing companies ' an no T;r:u it wo^kers,Electric.Boat's per` .longer,depend on older worke_rs to train sonnel managers, are ,trav6ling'7outside '`dun er replacements; as they once did` their traditional Connecticut-Rhode Island when craft jobs were passed.from father to "recruiting area—where unemployment a son..Although the shortage of skilled blue rates are 2% to 3%=andisin obs collar workers.is greatest in white-collar in newspapers as far away as . urg n cities such as Stamford, Conn., and lbs- Bay, Wis., and western Pennsylvania';' ton here mole than 70% of high-school where unemployment i her. In:addi seniors enter college—y^„^^ people are tion,f e coil mpany is cnp5idprtna na n re shunning factory jobs even in traii= tionally I cation expenses to fill certain jobs,"an ue-co,�ar as i urg , St. emp oy, ene i normally reserved for Louis and Detroit. managers and professionals. Philip Gruber, a.union'representative Electric Boat also is trying to upgrade and former tool-and-die maker at Ehrhardt its image among high-school guidance Tool&Machinery Co.in St.Louis,doesn't counselors who,it says,tend to steer grad- plan-to encourage his son to follow in his .4T 't> s a from facork 1n favor of,, footsteps. Although remarking.that' the eotlege or white-collar jobs."In the eyes;of' tool=and-die trade has'been"good"to him, most people,heavy manufacturine:is L,nex- Mr, Gruber, like many of his co-workers, cites inp,�"Mr.Kelly says.';We_l_vee t�o c_on- believes that white-collar io_bs now offer Vince them that they can w d h1-')—'nter�sling ewer otnoortumttes. careers here." "There's a feeling among younger That won't be easy because.th�hly workers that fa_cto�r'�o_bs are dirty and cyclical defense in ustry often hires and boring," he ad&s. "9ome maclunh's -work fires em o ees according to shi ni g v 3n�acTories that 110 degrees in the Y e nnie ending,says arm brown.-an summer, watching a drill press punch out economist at Howard University in Wash' the same thing day in and day out." ington,D.C."It's hard to et eo le enthu- Companies,in turn,complain of a grow- siastic about Working in a ere ing mismatch between the jobs they are. t lir° is little securi „ he adds. trying to fill and workers'skills.They say The construction industry suffers from many job applicants•can't pass reading similarpr ns.In the Washington area, and math tests to qualify. for apprentice w rTf e the unemployment rate is only 3.4%, positions.In the past,poor academic skills an acute shortnLye of construction workers ;didn't automatically ruin an applicant's >.is f rcnhg builders "to use a lot of Yankee chances,' but' as manufacturing becomes ingenuity" to avoid backlogs and costly more sophisticated, workers are running cancellations,says Robert Herr,the presi umerically controlled computer equip dent of Washington-based Donohoe Con struction Co. ment requiring an,understanding of math. "Once, all you needed to get a job was to Architects in Washington sometimes al ter construction designs because of shortbe someone's cousin, while now you have `.ages of bricklayers, roofers, carpenters, to be Able to figure algebraic equations," "steam fitters and sheet metal workers,Mr. do.says Howard University's.Mr. Brown. Herr says.Customers requesting brick ex- Desperate for workers,a growing num •. tenors; for example, are berTompane s�a e pushing mandatory p persuaded to overtime and,as a last resort,a even switch to prefabricated concrete,which re girming M raise wages: quires less labor to install. Laureno Lumber& Mill Work Inc.; in . Others cope by relocating to high unem Suffield, Conn., has extended its average f ployment areas. A northern New Jersey workweek to 55 hours from 40.The lumber- publishing company,seeking to expand its yard also recently increased beginning pay operations, moved to Allentown, Pa., for forklift operators, door makers and where a recent plant closing guaranteed.an, woodworking-machine operators from$6 ample supply of pressmen. an hour to a scale ranging from$7 to$9 an Behind the shortage are several eco- _,.hour. "We couldn't get anyone to answer nomic acid demographic forces, including `our ads at$6 an hour," Michael Laureno, the shrinking numbers of young people en- its president,says. He is considering pay- tering the labor market and the fading ap- ing.;recruits $1,500 bonuses—in three peal of blue-collar work. But-employers $500 installments during their first year on themselves are at least.partly,to blame, the job—despite fear that that will balloon economists argue. costs and encourage long-time employees Hoping that shortages will prove tempo to seek pay Iincreases. ` rar7 many compameTe—wanTed.to Some small companies, such as h.. I es ow an a so re use o offer Vanipco Machine & Tool Inc.. in Pitts- rainingto puten ha wor ers," says . r. burgh, have to 'raise wages to keep en o he University of California. At workers from defecting to larger compa- the beginnirw of 1987,averagre hourly wage nies with better pay and benefits. In the rates for ni•+�' s LII ed from$14 to past 18 months, the maker of punch $16, a�the same as in 198 -Mfie past. , presses for the metal-stamping industry ur y.ars, lick avers Ify have re- has raised pay of its non-union machinists mainedunchaneed at $14 to $17 an hour, about $2 an hour,.to•between $11 and a d the average S15 an hour for-tool-and- $13. die makers,ers, hash t risen, eit her. ow►ng Economists and personnel managers u�r °�nfl_a]joon..,.reeaal wages are own. agree that waee pressures are building. Meanwhile, many, pro- Wharton Econometric; I;orecasting A soci- grams have dwindled,s arp yy limiting[ e ates in Rala Cynwyd, Pa., expects wage 75)()1 ofpotential aMployees.1'The cutbacks increases es a ween 4% and 5 ym . , up are partly due to corporate cost cutting from 2% to 3%in the nasi two veers. d and partly because of some unions' at- r_jgseph G. Laffui, a hunian-resources con- tempts to preserve the jobs of existing sultant in Hartford, Conn., says: "If members by reducing the numbers of workers.at McDonald's are making $6 an , trainees. The Machinists union estimates hour;.and I'm a factory worker making the io is b ; erJ. .Ytic �rxPt crna�l,.. asks .- o� 1 . c , oc ,l�� ro1. 7 jec.ssed. -t . ' ','113y,RlcHaxn B SCHMITT. ," Edward E Crutchfield 4 , First Union stance more 'than double the ;amount. SCaffREIJOTrtQTOfTHr WALL STREET JOURNAL Corp chdlrman.and chief executive offi- given before Its settlement; The"•aid "in= First Interstate Bancorp considers its cer,'described'the process at a°banking eludes seed grants for fledgling inner-city a good citizen:It recently sponsored a'pro- `conference last';fall' { businesses;;including a telephone-answer- gram to,,each California schoolchildren But regulators.say the activists play an ing.company,,a contract-sewing,business about finance••,and it:bankrolled'a•casino important role..in-,seeing that community- :and an:apartment-maintenance firm. The operator's aiitique-car museum in Nevada •t ,service requirements are,met.Jim Lowell, -bank is also giving$30,000 to help the Na-' among other:,causesl:�; community.affairs,.manager,;"for the;Fed ;;tional.Training and Information Center,'a But some people'aren't impressed.wlth era],Reserve,:says the activists are helpful 'leading organizer of Community Reinvest the'bank holding company's idea of char in assessing how well banks are meeting ment 4Act protests, rehabilitate,an ,ban ity."Cosmetic,";says Alberto Nieto,leader '.-i their.obligations. :Moreover;.he says,..the doned;Chicago beauty school.as its.main kA of,the'•-Fresno;Organizing-Pro"ect The» filings=;have`•rarely;delayed mergers `. office!., ' Mai group-is, _ea e e up a nlan by 'About $5..billion,in concessions,,have As part of its $1.1 billion acquisition of Firs In late o expaninto Texas• un s, }been won since;Congress enacted the law Crocker National Bank last year..'Wells legis the-company s a-arrf�'Snancin ore "nine years`ago,.,incl,uding':$1`billion last- Fargo Bank promised to provide $41 mil- low cost housin for t i�o r and loans to year,'activists and academic groups`esti -lion in, low-cost financing for community mmori sma usi projects 'Wells Fargo won't comment on _•The Los.-Ange es banking concern can t � ' terms but sources say the bank has pro afford_to;ignore such.demands Increas sly ,$ K'has , vided low cost`.financing for ventures in - dr,community activis are,, 0 eluding low-income apartments in the San ' banks to task=and wmmn ar a fin' ficial balked.at set Francisco Mission district and the shelter Qacessinns-undert a nmmiimty r. TYmOney for lOW-1nC0YTle "for battered,women. Reinvestment nt Act j• Interpreting the Law. Staffing Mergers, loans at.preferential'rates gBanks often voice support for such proj- We are:a,bank`? sa s an The,.law'requires that banks and thrifts,; y• , ects and some-including Wells Fargo- " Prov s a ey serve the Official`.`.We can't g1Ve say they would have provided much of,the convenience an'd neTaK 0-HocaT i aid an to fulfill their obligations un- t, . By char i_ n� a an haven't pro- A l aWay I110Iley ` der.the Community.Reinvestment Act eau, e commune wf�services be.; But'many banks say the concessions activists can threaten to stall an mer er 4•mate:.Since 1984,'when the.surge in bank. :>they are being pressured to,make go be.- it o avoid such de ays, an s o ten agree to, mergers. began, there_has.;beeri an esti gond the act's intended requirements.The Area million o'-f-do ars in.fmancme to ^ ",mated fivefold increase'in.. number`of law was passed ai a time of congressional e 0mmumty proiectsY iftheero_uns i drnn ;.mergers that,community groups have,for concern over "redlining," in which banks their oMPerflo❑�, mally:protested. F ;refuse,to make loans in certain areas- t .This year alone banks are expected to Mr.Nieto,head of the community group mainly poor or minority neighborhoods. y. po - ow-cos 'loans and ; >that'.has taken;.on First,Interstate, says "It is an act.that encourages outreach"to ,n o r id fnr such causes as ousin for ";,,federal data show that.,the"bank has.made " all communities,says Marion Cowell,First ;t a poor and the developmen o i y {few recent mortgage loans in West Fresno Uniori'general counsel. "It is not'an act �t in sses. e s argo an c i_•s providing a low-income and predominantly black and that requires bad loans or contributions" cost fin,cing for a s e eli�r or-fiat Hispanic area.iAmong other demands;his,":".. „Regulators conduct periodic.reviews to tarelLyomen. FirstBank o u 'group wants the bank to pledge$28 million see that Community Reinvestment require cago is Tel—ping finance work on the head in favored rate residential and commercial ments are being met.Mr.Cowell and other quarters,of.the National.,Training and In :loans,,over three years.,for borrowers in ”bank lawyers'say banks receiving passing ' formation Center, a major community ac West Fresno :. grades•shouldn't face merger delays if s tion.'group ;;.{ $o'far; Flrst.:'Interstate,,,which denies ,: community groups-suddenly object. e ' As bank mergers have•increased in re Mr.r Nieto's charges;`has,;offered to.in But .activists say that• regulators- ` cent years;"S,:community .groups. have i crease.its.marketing in;:West;.Fresno and swamped by bank,failures and other finan stepped up their protests under the Com- ;has promised to give special consideration cial problems-can give only cursory at - stepped -munity,Reinvestment,Acta.."Mergers have `:to any loan„requests from there:But,it has ;.tention to community concerns. e- provided•a forum for groups to raise griev ; balked'at•setting aside a specific`amount Some banks have begun to balk at the 's ances to get banks to spell out'commit- ; for low-income loans,`especially at prefer-, groups' demands. New Orleans-based Hi- 10 ments; which they wouldn't otherwise ential rates: "We are.a bank,,' says Jerry,. .hernia Bank,for instance,refused.to nego i make,'.'says Allen Fishbein,general conn Loeser,..ay First'Interstate.,lawyer: "We tiate with the Association of Community:.,:. in sel for the Center for Community Change ` can't.give away inoney. :'Organizations for Reform Now,or ACORN ,-- Way, Washington, D.C.,.group that,organizes Other banks virtually have.done that in which objected to Hibernia's acquiring an 1e:. community protests: 'the concessionsthey granted.Three batiks other Louisiana bank last year. Hibernia Most bankers"take a dimmer view of in'Chicago''agreed to waive closing fees `won Fed approval, but,after a nine-month the process:iTliey',say.'the activists, are -,or other loan costs on,a$153 million project delay,'!;and subject to several conditions o 'stretching the intent of the law,which they } to .rebuild olds.homes and finance.small ..including an .unusual arrangement in criticize as vague:.Some bankers say they businesses in..several;Chicago neighbor which the bank will report to the Fed about l are being:forced to take,on duties{that govt is hoodsaThe:project settles several merger 7 Its community activities." e ernrrient:agencies should`provide.""'OUiers �±:challenges;filed by,.community groups j `°Otherbanks7iave become more enthuse 1 contendthat'they have capitulated to de-':71, Charlotte,'N.C.-based First Union agreed °; antic. !Richard Hartnack, a senior vice i mantis that.-amount to extortion-just to to give`cash.rebates totaling.5%of,.annual ;,:president for Chicago's First National, •. avoid'delaying a proposed merger.. loanpayments p certain low income cus '.thinks;;neighborhood lending is good bus; "Banks`see lt;as•a payoff"to prevent Comers:who pay home-improvement loans ness,noting that none of the bank's recent= 9 the postponement.of mergers, says Rob t ' on time ? ' - community-development loans has gone S ert E. Mannion,' a Washington banking :This year; First'National Banle of Chi ” `bad.But he adds,"I may be the last bleed- lawyer and' a former Federal Reserve.,::` cago''will=make;more than .$500,000 in "fine heart liberal in the banking Indus Board official. "Pure blackmail" is how' ` `grants for;community.,activities, for,,in .._ try ' :e - _ '