How much do autoworkers really earn?

November 21, 8:14 PMProgressive Politics ExaminerJay McDonough

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After having written a number of posts related to the Big Three Detroit automakers, what invariably follows are comments about the exorbitant labor costs paid to auto assembly line workers.  The argument goes like this: the reason the Big Three is in such a pickle is because they have to pay their employees too much money.  This is invariably followed by some scathing words about the United Auto Workers Union.

The wage that's been bandied about most regularly is $73 per hour.  That does seem like a lot.  But, the truth is, it's not even close to that.  From Felix Salmon:

The average GM assembly-line worker makes about $28 per hour in wages, and I can assure you that GM is not paying $42 an hour in health insurance and pension plan contributions. Rather, the $70 per hour figure (or $73 an hour, or whatever) is a ridiculous number obtained by adding up GM's total labor, health, and pension costs, and then dividing by the total number of hours worked. In other words, it includes all the healthcare and retirement costs of retired workers.

Now, there's a reasonable case to be made that the Detroit automakers are burdened with some very high labor costs when you include hourly wages and benefits to both employed and retired workers, it's not the case that the employed labor force is making exorbitantly large coin.