Custom Fabricators, Incorporated Case Study
Since its release in 1994, the North American Free Trade Agreement (NAFTA) has impacted the manufacturing sector in the United States. Manufacturing organizations such as Custom Fabricators, Inc (CFI) have been forced to find ways to cut costs to remain competitive. In the United States, NAFTA has contributed to the reduction of employment in high- wage traded-goods industries, growing wage inequality, and a steady decline in demand for workers without a college education. The majority of the net jobs displaced were in the manufacturing sector. Growing trade deficits with Canada displaced 270,248 manufacturing jobs while growing deficits with Mexico displaced 388,682 manufacturing jobs, for a total of 658,930 manufacturing jobs displaced (64.9% of the total) (Scott, Salas, & Campbell, 2006, p. 1). Figure 2 displays job losses per state.
Figure 2
NAFTA Impacts on Jobs per State
Note: Retrieved from Scott, Salas, & Campbell, 2006, p. 1.
This paper will summarize the Custom Fabricators, Inc. case study by Chase, Jacobs, & Aquilano, p. 44, answer the discussion questions shown in Figure 2, and define the role of Operations Management at Custom Fabricators, Inc.
Figure 2
Case Study Discussion Questions
Note: Retrieved from Chase, Jacobs, & Aquilano, 2004, p. 45.
Custom Fabricators, Inc.
CFI is a non-union shop with loyal employees, and low employee turnover. CFI started by providing sheet-metal elevator panels for Orleans Elevator in the 1980s. Since that time CFI's role with Orleans has grown due to Orleans policy with regard to outsourcing. Not only does CFI produce panels, but CFI also provides the entire panel assembly, which includes the electronics, the eleva...
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... business strategies to remain competitive. These changes may require difficult decisions with regard to employee cuts and relocation of facilities but are necessary to remain in business. OM at CFI and other companies, must constantly examine potential threats and opportunities, and make improvements as required. These changes will ensure the company's position in the global marketplace.
References
Chase, R. B., Jacobs, R., & Aquilano, N. (2004). Operations management for competitive advantage (10th ed.). New York: McGraw-Hill. Retrieved February 23, 2007 from University of Phoenix, Resource, ISCOM/471Operations Management Web site: https://ecampus.phoenix.edu/secure/resource/resource.asp
Scott, R. PhD, Salas, C., Campbell, B. (2006, September 28). Revisiting NAFTA: Still not working for North America's workers. Retrieved March 23, 2007 from www.epi.org
During the great Depression, many people in the city were unemployed. A third of American farmers lost their land and had to move to city to search for jobs. Many African Americans were unemployed in the south, since white have priority over the job market than African Americans, it’s harder for them to get a job. African American started to move to North to search, but little difference did it make. Many took the position as janitors, street cleaners, and domestic servants. Mexican American and Chinese American were no better off, whites started to take over those jobs for Mexican and Chinese American. Women started to search for jobs as their family needed the money.
The unemployed and underemployed had been left to find work themselves
This was devastating because a majority of these companies left, taking their jobs with it, abandoning the citizens
Very high population rates do not correspond with working labor force, in that (Polaski 2004) the Mexican labor force grew from 32.3 million immediately before NAFTA to 40.2 million in 2002, meaning that Mexico needed almost a million jobs a year simply to absorb the growth in labor supply. Many theorists suggest that a free trade zone will increase employment, by the increase demand for labor therefore creating a vast rapid workforce. However, NAFTA has greatly impacted manufacturing employment, by producing a low small net gain in hobs in Mexico, in that jobs created in export manufacturing have barely kept pace with jobs lost in agriculture due to imports (Polaski 2004). There has been a visible weakening in domestic manufacturing employment, related in part to increase import competition. In addition, the cause of a decline in domestic manufacturing employment is caused due to the relocation of the maquiladora factory workforce, which the United States has relocated the maquiladora assembly plants to China and Indonesia, because of low wage, cheaper labor workforce, skilled workforce, and less environmental protection laws. The maquiladora assembly plants in the late 20th century have disappeared
The North American Free Trade Agreement (NAFTA) is an agreement between America, Canada And Mexico that coincides a triune free trade economic bloc between the three countries. NAFTA was a necessary deal to be made between the North American Nations to compete in the “Economic World Order”. NAFTA was first designed and drafted by American president George Bush senior, Canadian Prime minister Brian Mulroney and Mexican president Carlos Salinas on December the 12th 1992 in San Antonio Texas. NAFTA’S original creators where not the men that finalized the triune trade bloc but instead NAFTA was redrafted to appease all recipients of the deal and its respectful citizens. NAFTA was finalized and singed on December the 8th 1993 by American president Bill Clinton, Canadian Prime Minister Jean Chretien and Mexican President Carlos Salinas. NAFTA came in to full effect on January the 1st 1994. The history of NAFTA and its negative and Positive effect and the necessity of NAFTA will all be explained in this paper.
U-2 Job losers and persons who completed temporary jobs, as a percent of the civilian labor force
With little to no work available, people were looking for jobs elsewhere and many were looking in the big cities.
NAFTA- North American free trade agreement, allowed tariff free trade between Canada, USA AND Mexico. NAFTA has affected prices in Canada in a positive way, due to the lower tariffs goods from the US and Mexico can be sold in Canada for cheaper. NAFTA had created jobs for many Canadians in the automotive industry and it has allowed for better trade between the three nations. NAFTA is the reason why Canada and Mexico receive the most oil from the
Some of the many factories to be affected by these economic changes were those owned by GM in Flint, Michigan. By first laying off thousands of workers and then closing the plants altogether, GM ultimately eliminated over 30,000 jobs in the city of Flint.
The employment of NAFTA, allowed Canada to experience a significant surge in foreign direct investment (FDI), ultimately provoking economic growth and expansion. The expansion subsidized new business into Canada and encouraged the foundation of cross-border economic relationships, that have advanced globally competitive value chains, organizations, and enterprises. Since the implementation of NAFTA, investments made by the U.S have nearly tripled. The U.S. direct investment position in all sectors totaled Approximately $391.2 billion in all sectors of the Canadian economy. NAFTA’s provision has ensured stability for investment decisions to occur and has helped to enhance Canada’s attractiveness for foreign investors.
The goal of NAFTA was to systematically eliminate most tariff and non-tariff barriers to trade and investment between the countries. NAFTA has allowed U.S., Mexico, and Canada to import and export to other at a lower cost, which has increased the profit of goods and services annually. Because the increase in the trade marketplace, NAFTA reduces inflation, creates agreements on intern...
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As there were now subsidies for hiring more workers in the private sector, this opened up jobs as
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