One of the big arguments about the survival/government bailouts of the auto industry is what the workers make. I don’t mean their hourly wages (which are high enough as it is), but their true compensation levels. The figure, much debated, for the average auto worker was $40 an hour. That seems like a lot, until you read about what all goes into paying for employees. If a $14 an hour worker costs employers $20, it’s only reasonable that the $28 an hour auto worker costs GM $40 an hour.
Still, there is the old saying that you get what you pay for. When you train an employee, you want to keep them happy and working for you so they don’t defect to the competition or sabotage your business. Those benefits, while incremental, add up over time so that every little slice of cheese counts. Generally, the cost of replacing the worker is more than the cost of keeping the worker, unless you’re doing this in an attempt to bust the union. Still, it all can get very expensive either way.
Tags: employment, true cost of employment, economics, benefits and hourly wages, what an employee really costs