A Heftier Dose To Swallow

Rising Cost of Health Care in U.S. Gives Other Developed Countries an Edge in Keeping Jobs

By Kirstin Downey
Washington Post Staff Writer
Saturday, March 6, 2004; Page E01

For each mid-size car DaimlerChrysler AG builds at one of its U.S. plants, the company pays about $1,300 to cover employee health care costs -- more than twice the cost of the sheet metal in the vehicle. When it builds an identical car across the border in Canada, the health care cost is negligible.

In the battle for manufacturing jobs, the United States has always been at a disadvantage compared with underdeveloped countries where wages are low. But the rapidly rising cost of health care in the United States means that even developed countries sometimes have an edge when it comes to keeping jobs, according to interviews with dozens of corporate executives, legislators and health care consultants.

The United States has lost nearly 3 million manufacturing jobs since July 2001, with 43 consecutive months of manufacturing-employment decline, from about 17.3 million jobs to about 14.3 million in February 2004. During the same period, the manufacturing workforce in Canada has generally remained stable, at about 2 million jobs, even though the unemployment rate is higher there, at 7.4 percent, than in the United States, where it is 5.6 percent.

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