Here’s a great “clean up” story to end 2006. It’s the story of how American jobs are being swept out of the country by the big box American retailers. Stimulated by the sourcing policies of retailers like Sears and Home Depot, these jobs are that “giant sucking sound” Ross Perot liked to talk about. A Hong Kong company, Techtronic Industries, is purchasing the Hoover brand from Whirlpool Corp. for $107 million. Three years ago Techtronic bought Royal and Dirt Devil for $105 million, and moved their manufacturing jobs to the Chinese mainland. Now, 1,000 workers at Hoover’s plant in North Canton, Ohio are counting the days until Techtronic closes their factory and pushes more jobs offshore. “Hong Kong is one of the few places in the world where you can set your goals high, and with hard work, achieve them,” the head of Techtronic was quoted as saying in The Repository newspaper. Techtronic was founded in 1985 as Marco Polo Industries, mostly to trade hardware and household appliances. The company set up a manufacturing plant in Hong Kong, and today has more than $3 billion in sales. One of its first major contracts was to produce Sears’ Craftsman brand. “We made our first three cordless products for Sears in 1986. By 1988, we expanded our product range and exceeded a volume of over one million pieces in sales,” the owner of Techtronic said. In 2000, the company bought the Ryobi brand of power tools, one of the big sellers at Home Depots everywhere, and a major competitor to Black & Decker — another tool company that carries only an American name. Techtronic now controls 20% of the U.S. electric power tool market, thanks to buyers like Sears and Home Depot. If you’re wondering where the U.S. jobs went, look no further than Techtronic, which now employs 21,000 people worldwide, including 16,000 in Hong Kong and South China. They still apparently have 3,000 jobs in the United States. It has used its Asian manufacturing and engineering base to cut the cost of its products. To meet the demands of Sears and Home Depot for lower cost products, Techtronic employs Chinese labor, not “Cantonese” labor in Ohio. Techtronic has also owned Milwaukee, AEG and DeBro tools since 2005. All three brands are professional-grade tools. Milwaukee products are still produced in the U.S., and AEG and DeBro are made and marketed in Europe. But consumer tools production is now mostly offshore. Ryobi moved most of its South Carolina jobs to China. Now Techtronic is moving into “floor care,” buying Royal Applicance three years ago, and its Dirt Devil products. It also owns the Vax line of vacuum cleaners. Now Techtronic is buying Hoover, a company that used to belong to Maytag, which itself was bought out by Whirlpool. Hoover has been a source for Sears’ Kenmore vacuums, but before selling Hoover to Techtronic, Maytag (Whirlpool) was already cutting back jobs at its offices in North Canton, OH. Techtronic is expanding its contracts with Sears to make the Kenmore line of upright vaccum cleaners.
When you go to Sears or Home Depot, pause for a moment to think about the workers at the Hoover plant in Canton, Ohio. Remember that they lost their jobs so that you could buy a cheaper (and in many cases, inferior) product that still carries a familiar American brand name. But if you look on the box, you will see “made in China” or at least “assemble in China.” And the 1,000 workers in Canton will join the millions of other production workers who lost their jobs in the United States. You will now find those workers selling tools at Home Depot. If you are looking for the American dream of middle class life, contact the owners of Techtronic. Happy 2007 to the U.S. balance of trade deficit!
