As UAW fades, so does path to U.S. prosperity

By Nick Carey - Analysis

DETROIT (Reuters) - For decades, unionized manufacturing jobs have been considered the surest path to middle-class prosperity and realizing the vaunted American dream for blue-collar workers.

The United Auto Workers helped make that dream a reality.

"We created the middle class in America," said Olen Ham, one of the few surviving members of the 1937 "sit-down" strike in Flint, Michigan, which won the first union contract with General Motors Corp.

Later contracts brought paid holidays, pension benefits and health insurance, enabling blue-collar workers to buy cars and homes and to send their children to college.

But the latest concessions by the UAW with automakers Chrysler LLC and GM will make the road to the middle-class much rougher to navigate for the next generation of workers.

At GM, for instance, new "entry level" factory workers making $14 an hour will not be promoted to "traditional" worker status -- earning $28 per hour -- until 2015. All Chrysler new-hires through to 2015 will be at the entry level.

The use of entry-level employees and a two-tier wage system was enshrined in the UAW's 2007 contract agreement GM, Chrysler and Ford Motor Co, in which the union made landmark wage and benefit concessions.

A widely accepted definition holds that wages of about $20 an hour -- $41,600 an year -- is the minimum needed for a family of four to obtain middle-class rank.