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Electro-Motive Canada employee and welder Kelly Gordon in a building called "The Cottage" on the picket line outside the subsidiary of Caterpillar in London on Feb. 8, 2012, that is filled with names and signatures of the workers. (Deborah Baic/The Globe and Mail/Deborah Baic/The Globe and Mail)
Electro-Motive Canada employee and welder Kelly Gordon in a building called "The Cottage" on the picket line outside the subsidiary of Caterpillar in London on Feb. 8, 2012, that is filled with names and signatures of the workers. (Deborah Baic/The Globe and Mail/Deborah Baic/The Globe and Mail)

Manufacturing

In the Electro-Motive shutdown, an unsettling message for Canadian industry Add to ...

In years past, the jobs have flowed to cheaper manufacturing hubs like China or Vietnam. Now, they’re just as likely to shift south. Global competition isn’t just between multinational companies. It’s also between regions, desperate to attract jobs to areas where unemployment is high and local economies have been ravaged.

In this case, the locomotive jobs appear to be moving a scant six hours away, to Muncie, Indiana, where wages of $12 to $16 an hour are half those of the London plant. Muncie’s own jobless rate is 9 per cent, though officials figure the real rate is double that.

Talk to anyone on London’s picket line, and they will tell you this is a race to the bottom.

THE EMPLOYEES

It’s a blustery day on the picket line. Workers have been out in the cold since Jan. 1, when the company locked them out. But they remain in front of the shuttered plant around the clock, tending the fire, huddled in groups exchanging news.

Down the road, workers have erected a graveyard of wooden crosses. “Job cemetery,” reads one.

Outside, Kelly Gordon, a welder and single mother, says her daughter’s grades have suffered as a result of the stress. Ross Seeley, who worked 29 years at the plant, is revisiting his retirement plans. “I could retrain. But who’s going to hire me now?” he wonders.

Half an hour away in the village of Belmont, Ralf Zapke has a chemo bag belted around his midsection, gauze on his upper arms.

Last May he collapsed at work and was rushed to hospital. The 49-year-old was diagnosed with Stage 4 cancer in his esophagus, stomach, lymph nodes and liver. Doctors gave him six months to live.

He’s been on sick leave since then, and has already outlived the prognosis. He is a determined spirit, working out, eating healthy food, and in fact the cancer is retreating. More than anything, he wants to go back to work.

This month Mr. Zapke lost his job as a crane operator, and with it, he says, any hope of future employment. His wife, Lise, works at the local Beer Store, but it’s only part time (hourly wage: $16). They have put their detached home up for sale, hoping to downsize into something smaller and closer to hospitals.

Without benefits, they don’t know how they’re going to pay for his medication, home health care, or any of their basic needs.

The picket line remains in place, though its numbers are diminishing as people look for work, move or drift away. On Tuesday, the company said it had reached a tentative deal for the “safe and orderly” shutdown of the plant, which is subject to a ratification vote Thursday by union members.

Outside the plant gate, a Canadian flag still flutters in the wind.

THE TOWN

London’s effusive mayor, Joe Fontana, would much rather talk about the city’s opportunities – Dr. Oetker, for example, a German food maker, will soon produce five million pizzas a year out of a new plant.

But there’s no getting around the fact that Caterpillar’s closure is a blow. He figures the move wipes out $1-billion from the city’s GDP of $17-billion.

London’s jobless rate was 9 per cent even before Caterpillar closed the Electro-Motive Canada plant, well above the national average of 7.6 per cent. The mayor worries the closure will send it higher.

“Southwestern Ontario, which is the economic locomotive of the Canadian economy… is still struggling,” says Mr. Fontana, adding that he’s frustrated that the manufacturing industry doesn’t seem to have a champion in the current federal government.

Plants have come and gone over the years. This time seems different. For one, Electro-Motive Canada isn’t facing economic hardship. It just posted a record quarterly profit, as any of its 700 former workers will say. The plant is – or was – productive, profitable and reliable, with a stellar safety record.

The company, through an outside PR firm, declined repeated requests for comment.

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