Labor secretary: Michigan 'can win' under new trade deal

Detroit — Looking across the Detroit River to Canada, U.S. Labor Secretary Alexander Acosta on Wednesday urged the passage of a new trade deal between Canada, Mexico and the United States as a way to spur economic prosperity.

As the White House's relationship with House Democrats holds up the deal's passage, Acosta emphasized the labor protections that the United States-Mexico-Canada Agreement, or USMCA, offered. The North American Free Trade Agreement lacked such measure, he said, which became a major criticism in Michigan as automakers moved jobs to Mexico.

"If we can compete on an even playing field, we can win," Acosta said at the Port of Detroit's Nicholson Terminal. "To the state of Michigan, it's a really big deal."

Acosta championed the agreement's labor chapter that aims to protect workers and set standards for labor conditions parallel to the United Nations' International Labor Organizations recommendations. He pointed to Mexico's recent passage of a bill that protects workers' collective bargaining abilities as a step forward.

The trade agreement increases to 75% from 62.5% the percentage of a car's parts that have to come from the U.S., Canada or Mexico to qualify for duty-free treatment. It also requires 40-45% of automobile parts be made by workers who earn at least $16 an hour by 2023.

A recent report from the U.S. International Trade Commission predicts automakers will sell 140,000 fewer cars annually under the agreement, though U.S. automakers continue to support the deal.

"If the wages are increasing in Mexico," Acosta said, "that just means we're going to have more jobs here in the U.S."

But that also presents a challenge, Acosta noted. For the past 13 months and for the first time since the Labor Department has collected the statistics, the 6 million people searching for jobs is fewer than the 7.5 million positions available.

Following tours earlier in the day at Kentwood's Lacks Enterprises Inc. and Dexter's Paladin Attachments, both auto parts suppliers, Acosta emphasized the need to bridge the skills gap, encourage careers in skilled trades and "respect" those who choose a path that doesn't include college.

The Labor Department is using $150 million from H-1B visa fees from companies hiring foreign information technology, health care and advanced manufacturing workers to offer grants to community colleges to start apprenticeships. Nearly 500,000 pay-as-you-learn apprenticeships have opened in the past two years. It also requires businesses to provide 45 cents per federal dollar spent to help develop curriculum that teaches to private sector needs. Washtenaw County Community College is a grant recipient.

"Advanced manufacturing is one of the biggest use of H-1Bs, and those are great jobs right here," Acosta said. "These are all good jobs that can be held by Americans right here, so we want community colleges to provide skilling opportunities in those areas."

And despite forecasts that the United States will see slowing economic growth in 2019, Acosta said he remains positive based on strong consumer confidence and deregulation that save companies on costs and helps to get projects into the marketplace sooner.

"I think unemployment is low, but I think there's room in the labor force to employ more individuals," he said, adding that two-thirds of new jobs have been filled by those who previously were not in the labor force. "I think especially with the passage of UMSCA, we're going to see particular areas in Michigan with a lot more growth."

bnoble@detroitnews.com