This story about IKEA’s first U.S. factory—wooed to Virginia with $12 million in government incentives, now facing a contentious unionizing drive—is most amazing for this teeny little bit of info about Sweden vs. America wage differences, which are what led IKEA to set up shop in Danville, VA, USA, in the first place:
The big difference is the Europeans enjoy a minimum wage of about $19 an hour and a government-mandated five weeks of paid vacation.
Full-time employees in Danville start at $8 an hour with 12 vacation days — eight of them on dates determined by the company.
America, now open for your outsourcing business!
Plus, Swedish workers have 7 hour work days.
IKEA originally started factories in Soviet Poland instead of Sweden. Because it was cheaper than Swedish labor.
doesn’t really matter-
Union will destroy the business before the year is out…
However we can factor the pay/taxes/cost of living to make this apples to apples, how does the take-home pay compare, I wonder?
However you slice it though, the idea of companies using US labor to save money is pretty grim.
@3, as they should. The Danville operation as described shouldn’t be allowed in a first world country. Eight bucks an hour? $16k a year? You can’t even afford to shop at Ikea on that wage. And “eight of them assigned by the company” means you get FOUR DAYS VACATION. That’s hideous. Everyone in America should be forced to take five weeks. Yes, FORCED.
and i bet Ikea got corp tax breaks to relocate
Its one thing to go after public state employees (from my POV, one almost has a valid argument), but private workers? Id love to see them try that noise. Bob McDonnell is the Republican Govenor and pro-confederate guy, so who knows what kind of crazy he would conjur up.
Sweden also has full health-care coverage and mandatory maternity and paternity leave as well as subsidized day-care. Minimum wage earners also receive housing subsidies. They also have the benefit of true mass transit. Who cares if the cost of living brings down the hourly minimum wage from $19 to $5 or $6 an hour under those circumstances? It’s not as if our cost of living means $8 an hour in real wages in the US. These workers will probably have to drive to work, with gas at $4 a gallon.
@5, but if we were forced to take five weeks, the citizenry might gain the mental clarity to begin running the country using reasoned debate and good humor, rather than fear and spin and rage.
And we just can’t have that. It would be un-American.
Hooray for the immiseration of labor, now we can all buy 100 Glimma for 3.67kr
I think the IKEA store employees in Renton get better wages and benefits than the Danville people…isn’t the WA state minimum wage near $8.00/hr? I didn’t realize you could get factory toiling so cheaply in this country.
What this tells me is that we could raise our minimum wage to $15/hour and mandate 3-week annual vacations and still have a competitive advantage with workers in Sweden. So why don’t we?
@11
You can in Right to Work states.
look at your ikea boxes – that shit ain’t made in sweden. eastern europe, asia, etc.
What kind of manufacturing does Sweden have? Anything other than lefse and lingonberry jam?
@16: Not very much.
Tell these facts to any conservative in the US and they’ll try to tell you those countries are all going bankrupt and otherwise incapable of functioning.
@18 From here, that sure sounds like what’s happening to the US…
It isn’t just Ikea – Volvo employees at the New River Valley Truck Plant in Dublin, VA are UAW members and still make less than Volvo employees in Sweden. The relevant part of the LA Times article is where the local Ikea management blames the lower US standard of living for the lower salaries and benefits at the non-union plant that’s fighting to stay non-union in spite of Ikeas overall pro-union corporate policy. “Carry me back to Old Virginny, that’s where this old darky’s heart am long to be.”
@3 I live on 16k a year. It’s not fun. 75% of my income goes to rent. Every raise I get is immediately offset by a reduction in my foodstamps.
And this is a management position.
“I live on 16k a year. It’s not fun. 75% of my income goes to rent. Every raise I get is immediately offset by a reduction in my foodstamps.”
Should have studied harder in school and been more ambitious. Hopefully you’ll teach your kids to not make your mistakes.
Today the Swedish Krona hit a two year high against the dollar and several Wall Street bankers responding to the precipitous drop in the value of the dollar suggested that the best place to invest in currency is in the Krona. I wonder what they would say if someone told these bankers that Sweden is a welfare state where the primary role of government is to protect and promote the economic and social well-being of its citizens by maintaining an equitable distribution of wealth. Sweden’s generous benefits, emphasis on maximizing labor force participation, promotion of gender equality, and a significant redistribution of wealth is the envy of Europe. Access to benefits are based on residency not citizenship and all residents in Sweden are entitled to nearly all the benefits available to Swedish citizens. The social security system is designed to ensure a minimum standard of living is based only on residence. Health care is accessible to all residents and health and dental care is free for children under 18, adults get vouchers. All workers are entitled to paid parental leave up to 480 days, 60 days for each parent with the rest divided up between them. Also, parents are free to take their days anytime until the child reaches the age of eight or completes his or her first year of school. All children in Sweden are entitled to a tax free child allowance which is paid until 16 and after 16 all children in full-time education are entitled to a study allowance, with a special large family supplement paid to families with two or more children. All residents and citizens are guaranteed a pension and Sweden invests more of its GDP to care for its elderly than any country in the world. And guess what- in September 2011, while many US universities will be charging $50,000 per year, a university education in Sweden will be free. It’s enough to make a “Tea Partite Quiver”. And Wall Street says invest in the Krona.