For each mid-size car DaimlerChrysler AG builds at one of its U.S. plants, the company pays about $1,300 to cover employee health care costs -- more than twice the cost of the sheet metal in the vehicle. When it builds an identical car across the border in Canada, the health care cost is negligible.
In the battle for manufacturing jobs, the United States has always been at a disadvantage compared with underdeveloped countries where wages are low. But the rapidly rising cost of health care in the United States means that even developed countries sometimes have an edge when it comes to keeping jobs, according to interviews with dozens of corporate executives, legislators and health care consultants.
[...]
Jim Stanford, an economist with the Canadian Auto Workers union, said employers who could operate in either country save $4 per hour per worker by choosing Canada. "That's a reasonably significant differential. . . . It's one of the reasons Canada's auto industry has done a lot better," he said.
In a joint letter circulated in Canada in November 2002, officials from Ford Motor Co., General Motors Corp. and DaimlerChrysler said "the public health system significantly reduces total labour costs . . . compared to the cost of equivalent private health insurance services purchased by U.S.-based automakers."
| 