South Carolina Needs A Lot More Auto Workers

For nearly 30 years, BMW has built crossovers in Spartanburg, South Carolina. Mercedes-Benz entered the state in 2007 with a Sprinter factory in Ladson, and Volvo followed in 2015 with a Berkeley factory. Now, Volkswagen is spinning up a factory in Blythewood for the electrified Scout, which has analysts wondering: Are there even enough factory workers to staff all these plants?

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Automotive News asked the question, and spoke with some South Carolina automotive employers and economic groups to try and find the answer. The responses they got were telling—but not about the staff:

Even before construction begins on Volkswagen’s $2 billion South Carolina factory this summer, the state’s unemployment rate is 3.2 percent — lower than the national average of 3.5 percent.

When unemployment drops below 4 percent, “businesses have an extreme problem, either with work force availability, work force qualifications or willingness to work for the pay,” said Michael Morris, human resources director at ZF Transmission’s factory in Gray Court, S.C.

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Andreas Heinzelmann, Pintail’s director of industrial real estate, said the surge in auto manufacturing is a blessing and a curse.

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“Employers are concerned about getting caught up in a price war,” he said.

It seems the big concern for automakers in the region is that they may have to—gasp—pay their workers more, in order to attract the best talent. When unemployment is over four percent, companies can base their wages on competition with unemployment itself—your factory wage is better than nothing. But as more manufacturers move in, and that unemployment rate drops, factories will have to compete directly with each other to secure good workers. That’s a much costlier endeavor, and one the automakers of South Carolina seem intent on avoiding.

Companies will take any number of avenues in order to keep wages down. Some offer benefits, some hire children, and some build robots to tell fourth graders how good their company is—a real thing ZF is doing for South Carolina elementary schools, also from Automotive News:

ZF piques their curiosity in technology and engineering with the help of FeRDi, a high-fiving robot named after ZF’s founder, Ferdinand von Zeppelin.

FeRDi “talks about the company’s history and what we do here,” Morris said.

ZF also invites high school teachers and guidance counselors to spend the summer at the Gray Court factory to understand the company’s work force needs.

Teachers get firsthand experience in human resources, engineering, finance and manufacturing. At the end of the summer, the teachers give a presentation on what they learned and how they would apply it in the classroom.

ZF hopes that, by building the company up in the brains of children, it will be able to reap the benefits when they become employable adults—ideally, adults with a preference towards working at ZF. They’ll even be educated according to the company’s needs, by teachers who have visited its factories and know exactly what to each. If that sounds dystopian, welcome to our cyberpunk reality.

A battle between automakers on factory wages could make South Carolina better for workers—too many companies, too close together, driving paychecks higher and higher. Or at least that is how capitalism allegedly works.