The Rubber Meets The Road

The company veteran is scared. He has spent 27 years--his whole adult life--working as a technician for Michelin. Now he wonders how much longer his job will exist. The French tire-making giant has announced plans to boost productivity by laying off 7,500 people, 10 percent of its total European work force, before the end of 2003. "No one is sheltered from these layoffs anymore," says the technician, 46, who declines to be named. Where he and his wife work, at Michelin's main Clermont-Ferrand complex in central France, the company has cut its payroll by half, to 15,000, in the last 15 years. In 1997 the couple voted for the winning Socialist ticket; they liked Lionel Jospin's pledges to create jobs and build job security. And now what does the couple think of the prime minister and his cabinet? The technician's wife, 47, puts it in one angry word: "Charlatans."

The layoff news has only emphasized Jospin's flailing. In the same press release, Michelin said net profits for the first half of this year soared 17.3 percent above the figure for the same period in 1998, to ¤292 million. That brazen juxtaposition left Jospin spluttering in fury. "When you see a company announce a 20 percent increase in profits at the same time they are firing people, it's time to watch out," he said. His ministers called the company's plan "scandalous" and "revolting." But their indignation stopped far short of outright government action. Cracking down on Michelin is a job for organized labor, Jospin says. "There has to be a mobilization," he told France 2 television last week. "One can't wait for the state to do everything."

Labor leaders have already scheduled a strike for Sept. 21. But many French workers have begun asking if they can expect anything from the Jospin government. In June 1997 he assigned his Labor minister, Martine Aubry, to review the state's position on corporate layoffs. Instead Aubry cooked up a plan to cut the legal work week from 39 hours to 35. Michelin was one of the toughest foes of the measure. The company has a fierce tradition of resisting government regulation. Some labor leaders are now speculating that Michelin annouced its layoffs as a kind of revenge for the new 35-hour law--and as a challenge to Jospin. So far Michelin has revealed few details about the layoffs, not even saying how many French workers will be affected. Meanwhile the old hands at Clermont-Ferrand are bracing for the worst--and, fairly or not, blaming it all on the prime minister.