2 New Production Support Contracts – and The Death of Manufacturing Employment: Why Smart Companies Are Firing Everyone
American manufacturing is under attack. Not from China. Not from trade deals. From our own stupidity about how we hire talent.
While our competitors are building lean, efficient operations, we’re drowning in the bureaucratic nightmare of traditional employment. HR departments. Benefits administration. Payroll taxes. Workers’ compensation. Unemployment insurance. The endless liability of permanent employees who might sue you, might not perform, and cost you a fortune whether they’re productive or not.
Smart manufacturers are waking up. They’re firing everyone and going full contractor. And they’re destroying their competition in the process.
I just proved it with two positions in Warren, Michigan.
The Contract That Exposes Everything Wrong with Employment
Two Controls Engineer positions. Allen Bradley and Siemens expertise required. Posted on Automate America at $48 standard, $62.40 overtime, $76.80 Sundays and holidays.
Apply here: https://automateamerica.com/app/automation_work/index/3372
Within 24 hours, I had applications from 10’s of engineers, engineers with decades of experience. Engineers who are absolutely done with the employment scam.
Why? Because they finally did the math.
The Employment Scam That’s Killing American Manufacturing
Let me break down the numbers that nobody wants you to see.
Traditional Employment Cost (per engineer):
- $85,000 salary
- $25,500 benefits (30% burden)
- $6,500 payroll taxes
- $8,000 workers compensation insurance
- $5,000 unemployment insurance
- $15,000 office space, equipment, management overhead
- Training, $2,000
- Actual Hours Worked Per Year / 1000
- Total cost: $147,000 per year
- Total cost Per Hour Worked: $ 147/Hour
Contract Labor Cost:
- Average $68/hour
- Zero benefits, zero taxes, zero insurance
- Zero management overhead
- Zero long-term commitment
- Zero HR, time or cost
- Zero risk, contractors are suppliers
- Total cost 1000 hours of work: $68,000
- Total Savings – $78,000!
But here’s where it gets interesting. That contractor is getting paid $78K for one third of the year versus the employee’s $75,000 take-home for the entire year. Who’s more motivated? Who delivers better results? Who solves problems faster?
The contractor. Every single time.
Why Wall Street Loves the Contract Model
Revenue per employee is the metric Wall Street uses to judge operational efficiency. When you eliminate traditional employment, that ratio explodes.
Traditional Model:
- 100 employees at $145,000 all-in cost = $14.5 million in labor expense
- Revenue per employee needs to exceed $200,000 to satisfy investors
Contract Model:
- 20 core employees for administration
- 80 contractors for specialized work at actual cost
- Total labor expense drops to $8-10 million
- Revenue per employee jumps to $400,000+
Investors see operational efficiency. Leanness. Flexibility. The ability to scale up or down based on actual demand rather than carrying dead weight through economic cycles.
This is why Amazon, Apple, and every other smart company uses massive contract workforces. Manufacturing is just catching up.
The Allen Bradley Expertise That Corporations Can’t Build
Here’s why the employment model fails for technical positions: you can’t train Allen Bradley expertise. You can’t create it in HR orientation programs.
Allen Bradley’s latest ControlLogix 5580 controllers process data twenty times faster than previous generations. The ControlLogix 5590 systems integrate safety, memory expansion, and advanced communications in ways that require years of hands-on experience to master.
You need professionals who can walk into any facility and immediately understand:
- How to optimize existing ControlLogix architectures for maximum throughput
- Integration strategies between legacy Allen Bradley systems and new platforms
- Troubleshooting communication faults that shutdown million-dollar production lines
- Emergency response protocols that minimize downtime costs
Corporate training programs produce button-pushers. Real Allen Bradley expertise comes from solving actual production crises under extreme pressure.
Siemens Integration: The Skill That Separates Professionals from Pretenders
The complexity multiplies when you add Siemens systems to the mix. Modern manufacturing facilities rarely use single-vendor solutions. They need professionals who can seamlessly integrate Siemens S7-1500 controllers with Allen Bradley networks.
This isn’t textbook knowledge. This is battlefield experience that comes from:
- Diagnosing communication protocols between competing platforms
- Implementing safety systems that meet both Allen Bradley and Siemens standards
- Creating HMI interfaces that operators can actually use under production pressure
- Building redundant systems that prevent catastrophic failures
The professionals with this expertise write their own tickets. They choose their projects. They work when they want, where they want, and they make more money in six months than their corporate counterparts make in two years.
The Tax Revolution That Changes Everything
Here’s what corporations don’t want their employees to understand: contractors control their tax situation in ways employees never can.
Contractor Tax Advantages:
- Business vehicle deduction (trucks, maintenance, fuel)
- Home office deduction (30% of housing costs)
- Equipment purchases (laptops, tools, training)
- Business meals (every lunch, every client dinner)
- Travel expenses (hotels, flights, per diem)
- Professional development (training, certifications, conferences)
Smart contractors pay almost zero taxes. They reinvest everything back into their business, take distributions instead of salary, and build wealth while employees pay full freight to the IRS.
At year-end, contractors can bonus themselves whatever they want based on actual performance. Employees get whatever HR budgeted eighteen months ago.
Why Michigan Leads the Contract Revolution
Michigan’s manufacturing sector understands operational efficiency better than anywhere in America. Our training infrastructure produces the specialized talent that commands premium rates nationwide.
Michigan’s Training Advantage:
- Rockwell Automation’s Workforce Development programs for Allen Bradley mastery https://www.rockwellautomation.com/en-us/support/workforce-development-training.html
- Community college Siemens partnerships for TIA Portal expertise https://training.plm.automation.siemens.com/ilt/locations.cfm?locID=38
But the secret sauce isn’t the training programs. It’s the manufacturing culture that demands results over politics, performance over process, and solutions over excuses.
Michigan contractors understand that when production lines fail, nobody cares about your feelings. They need problems solved, systems running, and profits protected. That mindset creates professionals worth much more than traditional employees.
The Platform That Enables American Manufacturing Dominance
Traditional hiring is economic suicide. Companies spend months screening candidates, weeks negotiating offers, and years managing underperformers they can’t fire.
Automate America eliminates that waste entirely.
For Manufacturing Companies Ready to Win: Post your contract: https://automateamerica.com/app/automation_work_new/add
New to the platform? https://automateamerica.com/app/login
The Automate America Advantage:
- 40,000+ pre-screened automation professionals ready to work immediately
- No HR overhead, no benefits administration, no long-term commitments
- Specialists in Allen Bradley, Siemens, and integrated control systems
- Emergency response capability for 24/7 production support
- Results-driven professionals who get paid for performance, not presence
When you need Allen Bradley ControlLogix expertise, you get professionals who have actually commissioned these systems. When you need Siemens integration, you access specialists who have solved these exact problems before. No training period. No learning curve. Immediate impact.
The Liability Protection That Changes Everything
Employment creates liability. Contractors eliminate it.
Employment Risks:
- Wrongful termination lawsuits
- Workers compensation claims
- Unemployment benefit costs
- Discrimination complaints
- Performance improvement plan nightmares
Contractor Reality:
- Project-based agreements with defined deliverables
- Professional liability insurance carried by the contractor
- No long-term financial obligations
- Performance problems solved by contract termination
- Legal protection through clear scope definitions
When production depends on specialized expertise, you need professionals who understand that their success depends on your success. Employees collect paychecks regardless of results. Contractors get paid for solving problems.
The American Manufacturing Renaissance Requires Contract Labor
We’re reshoring manufacturing from China. Building semiconductor fabs. Installing Data Center hardware. Creating the advanced manufacturing capability that will define American economic dominance for the next century.
This requires the most efficient use of professional talent in our nation’s history. We cannot succeed carrying the dead weight of traditional employment models.
The Warren contract proves the future works:
- Companies get world-class expertise without employment overhead
- Professionals earn what they’re worth while controlling their careers
- Projects get completed faster with better results
- American manufacturing becomes competitive globally
Why Every Other Choice Is Economic Suicide
Continuing with traditional employment means:
- Carrying unproductive employees you can’t fire
- Paying benefits for people who deliver mediocre results
- Managing HR bureaucracy instead of focusing on production
- Competing against lean operations that use contract labor
The companies adapting to contract models are destroying traditional employers. They move faster, cost less, and deliver better results because they use the best available talent for each specific challenge.
Questions about making the transition? Tony Wallace
📧 info@automateamerica.com
📱 Text me: 586-770-8083
The Future Belongs to Contract Labor
American manufacturing will dominate global markets through operational efficiency, technological superiority, and the intelligent use of specialized talent. The employment model is dead. Contract labor is the future.
Automate America provides the infrastructure that enables this transformation. We connect the most skilled automation professionals with manufacturers who need expert solutions delivered fast.
This isn’t theory. This isn’t wishful thinking. This is happening right now. The Warren contract is just one example of how smart companies are building the future of American manufacturing.
The revolution is underway. You can lead it or be destroyed by competitors who embrace it.
The choice is simple: adapt or die.
