Friday, November 21, 2008

More Ambivalence

I stumbled across a very well-written blog post about the plight of the Big 3 automakers, or more specifically, about the plight of the communities built around them. It is a thought-provoking post.

I wrote earlier about my ambivalent reaction to the financial industry bail out. I am also ambivalent about the calls for the bail out of the car industry, but for different reasons.

Once again, I understand the reasons for a bailout, and I don't really want to see GM and/or Chrysler fail. I wonder how bad our economy is going to get, and I worry about the fate of all of those workers who depend on the car industry in some way to put food on their tables.

But I am still ambivalent, largely because it seems to me that any government money is just going to postpone the inevitable for the American car industry. It seems that the industry needs to go through some painful restructuring and perhaps downsizing before it can be healthy again. I can't figure out whether it would be worth the cost in tax dollars to delay this inevitable restructuring. Would we delay it long enough to allow the general economy to recover, so that the workers who lose their jobs will be able to find other jobs? Maybe we should just take the money and put it directly into programs to help laid off workers, and let the car companies figure out some other way forward without our tax dollars.

I know that my view of layoffs and job security is skewed by the industry I work in. I work in biotech, where it is considered a log run if you last 5 years at a company. Some companies don't even last 5 years. Companies merge, get bought, and just plain go under all the time, even when they have good ideas and competent management. And even if your company is doing OK, you might be laid off because it has decided to change research directions, or needs to conserve cash to extend its "runway" (the amount of time it has before it runs out of money).

Biotech is a risky business, but it is a lot of fun. I love the team atmosphere and the sense that I can make a difference at my company. I have been laid off, and I have watched many, many friends get laid off, too. Most of us were re-employed before our severance check is exhausted, but I have also watched some friends struggle to find the next job. In some ways, this has been a good experience, because it means that Hubby and I have a substantial buffer of savings set aside in boring, safe investments, waiting to tide us over if I lose my job. It means that I am always thinking about what skills I need to add to my resume and what experience I should try to get to make myself more employable.

My industry can be brutal, but it is also quite resilient. I think this resilience comes from the fact that there are many small companies (and a few very big ones), all trying different things and innovating in their own ways, trying to fulfill unmet medical needs (i.e., get a drug on the market). If one company gets in trouble and lays off a lot of people, there are other companies around who might be hiring.

This experience in biotech makes me wonder if what the auto industry needs is to splinter into more companies. Sure, there were synergies and economies of scale from the conglomeration of all those brands. But maybe the industry would be better off if there weren't so many models that look just like other models. Maybe it would be better off if there were some scrappy little "auto-tech" companies coming up with new designs and innovating on production processes. Most of these companies might fail, but some would succeed. And one or two might just change transportation the way Genentech changed medicine. Tesla Motors is one such company. Why aren't there more?


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  2. I picked up on your comment on Sweet Juniper when I went back to check out the further debate there. Just to say I agree with you that so called "bail out" money would be better used on retraining, regeneration and small business start up than giving it to the big corps.

  3. By the way I tried to add you to my follow list and got a message saying you have no feed. You might want to consider reviewing your settings?

  4. These companies are selling an undesireable product with thousands of union feeds built into the price of each. I have conflicted feelings about unions but it seems clear that just bailing out the automakers won't fix these problems, which are fatal.

  5. @The Grocer- that is weird, because according to my settings page I am publishing the full post as a feed. I have subscribed to my own feed in Bloglines, and it seems to be working. But when I click on the RSS sign in my browser, I also get told there is no feed for my site. Maybe Blogger is having issues- I'll email support and see if I can fix them. In the meantime, here is the feed URL:

  6. Problem resolved, feed is working again. Thanks.

  7. Anonymous11:59 AM

    I keep thinking that maybe bankruptcy may be what these companies need, giving them a chance to restructure.


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