Manufacturing losses give rise to auctions

From a peak of more than 19 million in the 1970s, manufacturing jobs in the United States have dwindled to only about 12 million today, and the continuing recession is likely to depress the number still more.That means that firms like Hilco Industrial, an auctioneering firm based in Farmington Hills, has all the work it can handle these days selling off the leftover pieces of America's manufacturing base.

Each auction is necessary from each distressed company's view. But the sale of so much industrial equipment strikes many observers as an American tragedy.

Sitting among the bidders at a Hilco-run auction earlier this year at a closed Delphi plant in Dayton, Ohio, Mark Boeckl, president of a small company called TDM International in Flint, said that auctions like this spell disaster for America's once-mighty manufacturers.

"The scary part is all the infrastructure, all the manufacturing, is leaving," Boeckl said. "And literally what they don't sell they're scrapping. So, if the work does come back, now people are going to have to invest huge amounts of money."

Economists say many U.S. manufacturing jobs have disappeared through innovation, as a drive toward ever-greater productivity made factories do more with fewer workers.

But the rise of China and India as manufacturing powers in recent years has drained away many more jobs from U.S. factories. The collapse of auto sales in late 2008 took out still more companies and jobs.

Buyers at Hilco's industrial auctions range from local farmers hoping to pick up a band saw to Asian or South American industrialists seeking specialized equipment.

Boeckl said he was attending the Dayton auction earlier this year because he hoped to pick up a few specific pieces of machinery. Boeckl's firm makes auto parts for product lines hard to obtain any more in the United States. Delphi made a particular part in Dayton for Chrysler, and Boeckl hoped to buy the equipment, haul it to his plant in Flint, and win the business for TDM.

But even as he benefitted from Delphi's distress, Boeckl shook his head as the auction progressed.