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Ford CEO Jim Farley learned from older employees Some of the carmaker’s younger workers were taking shifts at Amazon, he said at the Aspen Ideas Festival. Farley said he credits founder Henry Ford’s decision in 1914 to raise factory wages to $5 a day to make temporary workers full-time employees. Due to low wages, young people have previously given up productive work.
Some economists credit carmaker Henry Ford with jump-starting the American middle class in the 20th century, when in January 1914 he raised the factory wage to $5, more than double the average wage for an eight-hour workday.
More than 100 years later, facing the reality of many employees, Ford CEO Jim Farley said he took a page out of the founder’s playbook.
The carmaker’s chief executive recognized the need for change in his workplace when talking to veteran employees during union contract negotiations, and that young Ford workers were overworked due to low wages and insufficient sleep, Farley said in an interview with journalist and biographer Walter Isaacson.
“The older workers at the company said, ‘None of the young people want to work here. Jim, you pay $17 an hour, and they’re stressed out,'” Farley said.
Farley said some of the workers even held jobs at Amazon, where they worked eight hours before sitting in a seven-hour shift at Ford, sleeping only three or four hours. At the Ford Pro Accelerate event in September, the CEO said entry-level factory workers told him they were working three jobs.
As a result, the company made temporary workers full-time employees, making them eligible for higher wages, profit-sharing checks, and better health care coverage. The transition was outlined in 2019 contract negotiations with the United Auto Workers (UAW), with temporary workers able to become full-time after two consecutive years of employment at Ford.
“It wasn’t easy to do,” Farley said. “It was expensive. But I think we need to change that in our country.”
Ford’s own decision to double factory wages in 1914 was not altruistic, but rather a strategy to attract a stable workforce, as well as provide an incentive for his own workers to be able to afford Ford’s products.
“He said, ‘I’m doing this because I want my factory workers to buy my car. If they make enough money, they’ll buy my own product,'” Farley said. “It’s a self-fulfilling prophecy in a way.”
Farley, a spokeswoman for boosting U.S. manufacturing productivity to support a vital economy, advocated for young workers to have strong business experience. Earlier this month, he raised the alarm over the lack of manual labor jobs, saying in an episode. Office Hours: Business Edition podcast that Ford had 5,000 open mechanic positions that went unfilled, despite the $120,000 salary for the role.
