China expands aviation work

Zou Jian is on her way to achieving the American dream -- except that it's happening near the Strait of Taiwan.

The 29-year-old works as a structural engineer, converting 747s from passenger jets to freighters for a growing company, Taikoo (Xiamen) Aircraft Engineering Co., better-known as TAECO.

She makes about $500 a month -- less than one-tenth what a Wichita engineer makes. She lives in a 600-square-foot apartment provided by the company with one bedroom, a small stove and a TV set.

From Xiamen, a city of palm trees, a large university and a tourist haven known as "music island," she works with other engineers based in Hong Kong, Japan and Seattle.

She spent one month in Wichita in 2000, learning her job from Kansans.

One year later, Boeing announced it was closing its commercial modification center in Wichita, saying there wasn't enough freighter conversion work for it to continue. The center, which had employed 1,000, closed the next year.

Xiamen was one of several sites that took on additional Boeing modification work afterward. Boeing notes that because TAECO works on a different type of 747, no work was directly transferred from Wichita to Xiamen.

TAECO continues to expand and develop. Today, it opened a new hangar and celebrated its first modified 747-400 Boeing converted freighter, completing work similar to what used to be done in Wichita on other types of 747s.

The freighter is the first of six ordered by a Hong Kong airline. With 2,800 employees, TAECO can handle twice as many aircraft for maintenance and modification as it could four years ago.

Zou sees her company's growth as an opportunity to better her life.

Boeing and Airbus see China's growth as an opportunity to sell hundreds of planes over the next 20 years, generating work that could go to Wichita as well as to China.

But China's development worries Americans who fear the U.S. is losing good jobs and know-how overseas. They want to stem that tide, if not reverse it.

If that doesn't happen, Wichita and America will face tough times as China rises, said Bob Wood, a 20-year Cessna worker turned Machinists' union representative.

"Aerospace is the last great American industry," he said. "When we outsource to other countries, we're killing ourselves nationally."

Every country's strength

Andy Wei spent 18 years in the People's Liberation Army Air Force. He now heads the Beijing office of Goodrich, which works on Boeing and Airbus products in China. He said Chinese workers provide great opportunities for Western companies, and that the best way to build an aircraft that benefits the world is to let every country play to its strengths.

China has less expensive labor -- less than $1 an hour for a line worker in Xian, though Wei said that with subsidized housing, medical and other benefits, compensation rises to $4 to $7 an hour.

America has more advanced technology and better-skilled workers to use it, Wei said. Let them prosper together.

"China doesn't want to compete with America," he said. "We want everyone to benefit."

It's not that simple, said L. Josh Bivens, an economist with the Economic Policy Institute, a labor-supported economic think tank in Washington, D.C.

Even if outsourcing advocates are right in that greater job movement creates more global wealth, it also unfairly creates winners and losers, he said. Investors get richer and working-class Americans grow poorer when blue-collar jobs disappear and remaining jobs become less secure, he continued.

Wood said he's concerned with the potential loss of expertise in American aircraft manufacturing. As China's work force takes on more complex tasks, more companies have reason to locate jobs there.

More work for everyone

TAECO isn't a stereotypical low-tech assembly plant. It's majority-owned by Hong Kong investors with shareholders from Japan, the Chinese government and Boeing. Han Yun, a 33-year-old senior manager at the company, said it uses Chinese workers more effectively than the state-run companies that still dominate Chinese aviation.

The company's greatest contribution to China is the workers it trains, Yun said.

"Because of their experience, they get a better job, and do a good job someplace else," he said. "The workers here are very skilled."

Wade Cornelius, Boeing's vice president in charge of global strategy and the international marketplace, said China's work force is becoming more capable as the country opens to the West.

The question isn't whether China will be able to handle work for Western companies, he said. It's when will awarding work to China make the most business sense?

Sometimes, when taking into account where work needs to be done and how cost-effective that work will be, China will receive the work, just as Japan and other countries do now, he said.

Renton, Everett, Wichita and other cities will compete with China as they have for decades. China is becoming a more formidable competitor, but its development shouldn't raise fears of work force upheaval, he said.

If low-cost work helps fuel a sales boom -- and Boeing's in one right now -- jobs that go to China will be more than offset by the additional work worldwide created by its thirst for aircraft, he said.

"To the extent we can offer reduced costs, we can have greater sales success that keeps production lines moving," he said.

A mixed picture

In Wichita, the impact of Boeing's global strategy on its work force seems mixed so far. The aviation upswing fueled in part by China purchases is expected to bring new work to Spirit AeroSystems, the company that succeeded the Boeing Wichita commercial plant this year.

Still, overall Boeing employment in Wichita (including Spirit workers) has dropped from more than 17,000 in 2001 to about 13,000 today. The decline was largely caused by the downturn sparked by the Sept. 11 terror attacks. It was sharpened by global job competition.

Business is booming in Xiamen, brightening the future of Zou and a generation of well-educated, low-cost Chinese engineers. TAECO's rise is China's rise, bringing Zou a job that she enjoys.

"I think we are learning, and growing," she said.

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