Over the past seven years, Karen Houser has been laid off four times -- each time by a major U.S. manufacturer that was cutting back domestic production as a result of foreign competition.
After the first three dismissals, Houser, 39, had to fend for herself -- not only battling the state bureaucracy for unemployment benefits but, more importantly, conducting her own job-search campaign. Like most other laid-off workers across the country, she also faced alone the frustration of needing new skills to compete in the job market.
That pattern changed, however, last summer when General Electric Co. dismissed her after two years as an assembly-line employe in its Columbia, Md., plant. Unlike Houser's previous employers, GE set up a special reemployment center for Houser and 600 colleagues who were laid off after GE decided to shut down its domestic microwave-oven production. Three hundred more employes are scheduled to be laid off by the end of this year.
Finding work for those semiskilled workers with proficiencies not highly sought by other area firms has not been easy. To date, only about 150 have found new jobs and, for the most part, at far less than the relatively high wages they were being paid at GE.
"Most made $9.57 an hour as assemblers," commented the reemployment center's director, Michael Hickey. "Now they are accepting jobs for $6 to $8 an hour."
The centerpiece of the GE Reemployment Center, which is funded with $400,000 from GE and $100,000 from the state of Maryland, is retraining -- offering employes a wide variety of courses to provide them with new sets of skills in fields that promise more secure and lucrative jobs in the future.
Houser is one of 14 employes now taking advantage of what GE likes to describe as a "new beginning," participating in a nine-month electronics technology course to enable her to repair electronic and computer equipment when she graduates in June.
Nearly 120 other employes have taken a two-week soldering course to teach them how to assemble printed circuit boards for electronic equipment, a skill valued by many local employers. Meanwhile, 175 other workers have enrolled in a variety of other courses ranging from word processing and cosmetology to culinary arts.
"The training is significant because it gives employes a chance to have jobs in industries with a future; they do not have to stay in smokestack industries where there is little future," Hickey said.
Like most members of the Fortune 500, GE continues to prune its U.S. work force to meet the expanding challenge of foreign competition. Overall, its work force has dropped from 400,000 in 1980 to 300,000 today.
Unlike many companies, however, GE has tried to cushion its layoffs by offering employes help in finding new jobs or learning new job skills. The assistance is an essential part of GE's competitive strategy, needed not only to bolster the morale of remaining employes but also to maintain GE's reputation among consumers, GE officials said.
According to a congressional report released earlier this month, more than 11.5 million workers lost their jobs between 1979 and 1984 because of plant shutdowns or relocations. Most of these employes were middle-aged people who had had "a long, stable work history," not young workers who moved from job to job, concluded the Office of Technology Assessment, Congress' scientific and analytical arm.
"Manufacturing jobs -- especially production jobs -- will continue to decline," OTA said. "The most vulnerable jobs are those of unskilled and semiskilled production workers. These jobs are not only the easiest to automate, they are also the easiest to move overseas."
Of the 11.5 million displaced workers, only 60 percent had obtained new jobs as of January 1984, the OTA found. And for the most part, these jobs were in lower-paying fields, with 80 percent of those who found jobs reporting at least a 20 percent cut in pay.
Given these numbers, labor experts stress that reemployment and retraining efforts such as GE's are critical to the country's economic future.
"Retraining and job-search education are more important than severance income" when laying off workers, commented Jerome M. Rosow, president of Work in America Institute. "Training is very productive to the local community as a whole, because it continues to make available skills of people already in place. Even more important, from the standpoint of the individual, retraining doesn't represent an abandonment. The company isn't saying, 'Our business is closed. All we owe you is a year's pay. You take the money and find yourself a job.' Rather, the company is retraining an individual for his past record, and he does not become a total victim" in the dismissal process.
Up to now, the Washington area has felt little impact from major manufacturing layoffs, given the large proportion of government, service and high-technology business here. Baltimore, with major automotive and telecommunications manufacturing facilities, on the other hand, has been dealt a substantial blow. With GE's Columbia plant laying off half of its work force -- the other half will continue to produce GE ovens and ranges -- the impact of foreign competition on manufacturing comes closer to the metropolitan area.
For GE, retraining programs are far from new. Over the past five years, as the appliance powerhouse began shutting down many of its domestic plants, it set up guidelines for plant closings to make the process less painful for its employes. Chief among the guidelines is advance notice -- at least six months and more, if possible -- to give employes adequate time to adjust.
Additionally, GE has set up an income-maintenance program to make the dismissal more palatable. In Columbia -- a nonunion plant -- employes who have worked for GE for more than two years are eligible for income extension aid. For every year they have worked, the company has donated a week's salary to a special fund that draws interest. With a layoff, employes either can draw that money out as a lump sum or receive the money owed as a supplement to unemployment insurance to make sure employes are paid at least 60 percent of their base salary while they are looking for work. Thus, if a worker's base salary was $400 a week, and he was getting $175 in weekly unemployment benefits, he would be entitled to received an additional $65 a week from the GE fund to give him 60 percent -- $240 -- of his base salary as long as his money in the income-extension fund lasts.
It became evident a few years ago that Columbia's microwave facilities would meet the same fate of other GE facilities that were being closed as competition stepped up in the microwave market.
"You could see the handwriting on the wall," commented Joe Carando, Columbia's plant manager. "We couldn't compete."
There are at least 50 different suppliers of microwave ovens, another GE official noted. "It is a highly competitive market where we don't have a major share as we do in the sale of refrigerators or electric ranges. . . . We made a tough business decision and decided that, instead of putting our money into researching, developing and manufacturing microwave ovens, we should invest our resources where we feel we have a better shot of winning."
GE will continue to sell microwave ovens under the GE and Hotpoint brand. But the ovens will be made by foreign manufacturers under contract to GE. It also will continue its production of conventional GE ovens at the Columbia plant, maintaining jobs for half of the 1,800-member work force that existed a year ago.
Given the persistent rumors over the past few years, employes were not suprised when GE made Columbia's fate official last March. At that time, GE said it didn't plan to make its first layoffs until September. However, sluggish sales pushed that schedule up so that Houser and 300 other employes were dismissed in June 1985 when the company stopped making over-the-range microwaves. (The plant still produces counter-top ovens but that line is scheduled to be halted this fall -- resulting in another 300-employe layoff.)
The revised layoff schedule forced the reemployment center -- which had hoped to have three months to set up its counseling, job search and retraining courses -- to speed into action.
First, the staff of the center -- which is housed in the same building where 1,100 over-the-range microwave ovens used to be produced daily -- asked state unemployment officials to come to the plant and sign up employes for unemployment benefits to minimize the red tape and time employes would have had to endure if they had to go down to the state and county offices on their own.
Then its four professionals began counseling employes, individually and in group sessions, on how to find new jobs. With another 300 employes laid off in September, these sessions continue today.
First, employes are tested on sophisticated computer equipment to match their skills and desires with a job. Then, workers are enrolled in a two-week job-search workshop to teach them how to find a job. The workshop includes tips on how to write an application and resume' as well as how to find out about unadvertised jobs. "Eighty percent of the jobs available are never advertised," Hickey, the center's director, repeatedly noted.
Meanwhile, through advertisements in local newspapers and staff telephone calls, the center began listing hundreds of nearby jobs that it just had learned of. The listings continue today, with about 100 jobs posted at any one time. Eight phones have been set up to allow employes to call employers near and far at GE's expense.
Hickey stressed that the purpose of the center is not to have a counselor directly place employes in jobs, but rather to help the employes learn how to find jobs on their own. "Our motto here is 'Let us help you help yourself,' " he said. "Nobody can do a job search for anybody else. But we can teach them how to go about it and assist them in a whole variety of services."
The task has not been easy because, among other things, the GE employes were extremely well paid in relation to many of the jobs that are available, Hickey noted.
Additionally, when the employes first came in to the center, "They all said they wanted a job tomorrow," he said. However, in many cases, these employes either could not find the jobs they wanted or would have ended up in other jobs where layoffs might occur, he noted.
Hickey said the center has steered more than 60 percent of the 525 employes who have participated in the center's activities into retraining courses. The courses vary greatly, depending on individual desires. "If someone wants to be a plumber, we will set up an apprenticeship program, whatever is necessary," Hickey said.
Nonetheless, Hickey has tried to steer more than 130 employes into fields that he believes are in great demand in the area, offering special high-technology courses to employes. These courses include assembly-board soldering, word-processing and electronic technology. High-school equivalency courses also are given, and 68 employes have completed the course.
Additionally, the center offers a variety of seminars, ranging from how to start your own business to how to prepare for the postal service exam.
The center has placed 121 of its 525 participants in jobs. Another 20 to 30 employes, not registered at the center, have found jobs on their own. An additional 200 are enrolled in retraining courses.
Throughout it all, one of the microwave ovens that was the cause of the layoffs sits quietly on the wall in the snack area where employes eat. Given the support the center has provided the displaced employes, the microwave draws no ill feelings. In fact, "I'm rather proud of it," said Chuck Bell, who assembled control panels for the ovens for two years before being dismissed last June.