By Lily Bearings
©2004-2008
NTN Driveshaft (a division of NTN USA, and NTN, Japan), already working 28-hour 4-day weeks at its Columbus, Indiana factory, has now cut the workforce there by 200, or 16%.
The Columbus facility produces CV joints and axle assemblies for applications across a broad spectrum of the North American automotive and light duty truck industry.
The plant had been working the dramatically shortened workweeks for some time, as its order book is down more than 40% from year-ago levels -- continuing a slowdown which can be tracked all the way back to April 2007.
At the time, NTN VP David Miller said: "It was a decrease we had to make based on the economy. We're just trying to adjust to the amount of business the best we can."
Such short workweeks have spotty success in terms of avoiding layoffs; in addition, the U.S. labor department warns that pay cuts from shorter hours (30% in this case, from 40 to 28 hours) often leave employees unable to stay afloat financially -- more so than the apparently more dramatic step of cutting the workforce but leaving more hours for the rest.
In the end, the short week has not been enough, and now NTN has laid off 200 of the approximately 1,300 workers at Columbus.
In the February 12 layoff letter, NTN said the plant, "has found it necessary to reduce its workforce. As we look to the future, we find it hard to determine where the automotive market will stabilize. We are optimistic about the long term plans but must be cautious in this volatile market. NTN Driveshaft, Inc. will be reducing the workforce by approximately 200 employees. Those employees being outplaced by the reduction will remain on a recall list and will be asked to return to employment on an as-needed basis."
The layoffs have a small silver lining for those remaining. After the layoffs, the plant will reportedly be working an extra hour per day, or 32-hour, 4-day weeks, for a more manageable -- but still very difficult -- 20% pay cut.