Layoffs Begin at Carrier, Despite Trump’s Promise to Save Jobs
Carrier Corporation, which is owned by United Technologies Corporation, is holding true to its word. The manufacturer of heating and air conditioning systems has laid off 338 employees at its Indianapolis factory, which is in line with its announcement made earlier this year.
I reported in June that Carrier planned to lay off 338 employees by July 20. Despite President Donald Trump’s promises to save these manufacturing jobs from leaving the United States, Carrier is going ahead with outsourcing them to Mexico, and ending its manufacturing of gas furnaces in Indianapolis.
All of the affected employees will be receiving severance pay and benefits.
An additional 290 employees will be cut loose later this year. In total, approximately 630 jobs at the plant will be sent to America’s southern neighbor by December 22.
This suggests that only about half of the total 1,400 Indianapolis employees at Carrier have remained safe from the job cuts.
President Trump made “saving American jobs” a focal point of his election campaign. He formally visited Carrier’s Indianapolis plant and reassured voters that the company would be keeping jobs within the United States.
Soon after he was elected, Trump brokered a deal between Carrier management and the State of Indiana, in which the state government would give $7.0 million in tax incentives and grants to Carrier over a 10-year period. The idea was that Carrier would keep jobs in the state. Carrier, however, will be spending $16.0 million on automating the Indianapolis plant.
Trump boasted that he had saved at least 1,100 manufacturing jobs at Carrier following the Indiana state government’s deal. However, within months after Trump took office, Carrier announced hundreds of layoffs.
The manufacturer had announced last year that it would shutter the Indianapolis factory and eliminate 1,400 manufacturing jobs in the process. The company expected that the factory closure would annually save $65.0 million in operating costs .
Indiana, where manufacturing accounted for nearly a third of the total jobs 50 years ago, has seen a rapid decline in the manufacturing job market due to automation and offshoring. Today, only about 10% of the total jobs in the state are in manufacturing.
“Layoffs begin at Carrier plant where Trump promised to save jobs,” Chicago Tribune, July 20, 2017.
“Carrier Corporation announces outsourcing of hundreds of jobs to Mexico,” ABC 13, May 23, 2017.)
“Layoffs at Carrier start soon, targeting some of the jobs Trump vowed to save,” Los Angeles Times, May 25, 2017.)