Saturday, December 8, 2007

Ford Motor's Russian woes underscore shifting labor market

A strike at Ford Motor's assembly line has slowed production to a crawl and cost the pioneer of foreign car manufacturing in Russia millions of dollars' worth of lost production.

Workers walked off the job on Nov. 22 at the Ford plant in this outlying district of St. Petersburg, Russia's second largest city.

Following in Ford's footsteps, Toyota and Nissan are now building plants in the region that has become known as Russia's Detroit and is booming along with the car business here.

Ford management has since resumed one of three shifts using non-union employees. The plant remains choked back at a third of its normal production capacity.

The industrial action highlights the tightening labor market in Russia, a problem that would have seemed inconceivable only a few years ago, in the depth of the post-Soviet economic collapse.

The plants are compelled to pay ever higher wages. After two pay raises, each between about 15 and 20 percent, depending on the experience of the workers, the union is now demanding a 40 percent jump in the base pay.

The average wage at the Ford plant is now 21,500 rubles per month, or about $880, according to Ekaterina Kuliko a Ford spokeswoman in Russia.

"They say they produce cars to European standards so we want to be paid to European standards," Vladimir Lesik, an organizer in the Inter-Region Union of Automotive Workers, an affiliate of the International Metal Federation union.

Throughout Russia, a shrinking population, limited worker mobility and rapid economic growth have dried up the pool of available labor.

In Vsevolozhsk, the labor shortage has become acute. Toyota, which is farther along than Nissan in building its plant, is poaching experienced assembly line workers from Ford, according to the union.

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