Linked through skill: labor market interdependence in the automotive value chain

Abstract

This dissertation revisits old questions regarding how to increase manufacturing skills, but with attention to the asymmetrical position of large and small firms in manufacturing supply chains. Small-sized firms (under 500 employees) employ roughly half the U.S. workforce, but typically have fewer resources to invest in training their employees compared to their larger-sized counterparts, contributing to recognized labor market inequities. Power and resource asymmetries between large and small firms are particularly pronounced in the automotive industry. A large body of research on global supply chains provides a foundation for this inquiry into how suppliers might adjust their training practices in response to the constraints and expectations of their automotive clients. Integrating approaches from cluster- and supply-chain-based research, the dissertation’s three papers address three related questions: 1) How is skill dispersed across industries supplying the U.S. automotive industry?; 2) How do supply chain dynamics affect suppliers’ ability to train and compensate skilled workers?; and 3) How might smaller companies gain access to training resources in automotive clusters where politics and institutions favor larger firms? The first paper in the dissertation describes the skill requirements of industries in the U.S. automotive cluster. I show that the relationship between skills and wages is uneven and complicated: wages vary by supply chain tier, but in the opposite direction as skill requirements. The automotive industry clearly depends on the high-level manufacturing skills of sectors supplying intermediate goods, yet the lower wages in these sectors may impede skill regeneration and upgrading. The second paper investigates the training decisions of suppliers in a local automotive cluster. I find that cost reduction trends can deter suppliers from investing in training their own production technicians, but also that suppliers can leverage their supply chain position and activate local networks to increase training in spite of negative supply chain pressures. The third paper addresses a bias in the training system diffusion literature toward larger multi-national corporations. Shifting the focus to smaller multi-national enterprises, I find they are well positioned to activate institutional resources, both global and local, to introduce more accessible training models at their branch plant locations.Doctor of Philosoph