As part of the deal President-elect Donald Trump and Vice President-elect Mike Pence struck with Carrier, the company has promised to make a $16 million investment in its Indianapolis facility — an investment management plans to use on developing technology that will allow them to replace human workers with robots.
The company’s plans were confirmed by Greg Hayes, CEO of United Technologies, Carrier’s corporate parent, during a CNBC interview earlier this week.
“We’re going to… automate to drive the cost down so that we can continue to be competitive,” Hayes said. “Is it as cheap as moving to Mexico with lower cost labor? No. But we will make that plant competitive just because we’ll make the capital investments there. But what that ultimately means is there will be fewer jobs.”
This news comes on the heels of Trump blasting Chuck Jones, president of the United Steelworkers 1999 union that represents Carrier workers, for the sin of correctly pointing out that Trump exaggerated the number of jobs his deal “saved” during a December 1 news conference at the factory. Trump said the company agreed to keep 1,100 jobs at the Indianapolis factory when the real figure is closer to 800, with 550 workers at the factory facing layoffs despite Trump’s deal. In addition, Carrier still plans to ship 700 jobs from a separate factory in Huntington, Indiana, to Mexico. And as part of the deal, Indiana taxpayers will dole out $7 million in tax breaks to the company.
After Trump smeared him on Twitter, Jones received threats against his family.
In an op-ed published in the Washington Post on Thursday, Jones wrote, “what I can’t abide…is a president who misleads workers, who gives them false hope.”
“We’re not asking for anything besides opportunity, for jobs that let people provide for their families,” he continued. “These plants are profitable, and the workers produced a good-quality product. [United Technology made a profit of $7.6 billion in 2015.] Because of corporate greed, though, company leaders are racing to the bottom, to find places where they can pay the least. It’s a system that exploits everyone.”
It’s unclear when Carrier’s technological investments will allow it to lay off some of the 800 workers whose jobs were spared in the short-term. United Steelworkers 1999 didn’t immediately respond to an inquiry about what they know regarding when job cuts are happening and who will be affected. As Jones detailed in the Post op-ed, the union was completely cut out of negotiations between Trump and Carrier.
While the timing remains unclear, Jones said on Thursday that he expects cuts beyond the 550 layoffs that will happen in spite of Trump’s deal.
“Automation means less people,” he said during a CNN interview. “I think we’ll have a reduction of workforce at some point in time once they get all the automation in and up and running.”
Despite Trump’s pro-worker campaign rhetoric, the details of the Carrier deal and Trump’s nomination of fast food executive Andrew Puzder as labor secretary suggests he doesn’t have an issue with companies replacing humans with machines. Puzder is a proponent of replacing human workers with robots, telling Business Insider last March that machines are “always polite, they always upsell, they never take a vacation, they never show up late, there’s never a slip-and-fall, or an age, sex, or race discrimination case.”
CNN, citing a McKinsey & Co. study, reports that “45 percent of the tasks that U.S. workers are currently paid to perform can be automated by existing technology. That represents about $2 trillion in annual wages.”