Ed Breen, killer of moonshots

Also in this week's C&EN, this is quite the article about Ed Breen, current CEO of DowDuPont (article by Alex Tullo): 

DowDuPont CEO Ed Breen says he prefers small, short-term R&D projects that quickly yield marketable products to moonshots that are risky and more expensive. 

Breen took over as DuPont CEO in November 2015 and quickly inked an agreement to merge with Dow Chemical. At the Bernstein Strategic Decisions Conference in New York City on May 31, Breen discussed his company’s R&D strategy. 

Breen said that he scaled back ambitious projects as soon as he was in charge at DuPont. “When I got to the company, we killed almost all of what I’d call the moonshot projects,” he said. “And, by the way, the moonshots cost the most money. I didn’t feel comfortable with most of them.” 

...Additionally, in late 2015, Breen recast DuPont’s Central R&D organization, famous in the chemical industry for its devotion to long-term projects, into a smaller organization, Science & Innovation.

Short-term profits first! I look forward to looking at his track record 5 or 10 years from now... 

"Private employer screws up, taxpayers foot the bill"

In an article titled "Facing skills gap, employers send workers to college" at Marketplace, a wonderful example of the sweet deal sufficiently large manufacturers can wring out of localities: 

This is Cambridge-Lee Industries, in Reading, Pennsylvania. For nearly 75 years, this plant on the Schuylkill River has produced copper tubing, mostly for plumbing, heating and refrigeration. 

[New vice president of human resource] Fischetti is facing a challenge a lot of manufacturers in the area have: an aging workforce. During the long manufacturing downturn in the 1990s and 2000s, the factories that survived had no trouble finding skilled workers, he said, and many didn’t invest in training younger ones. 

“Over time that has now hurt our organization, where we have a population that are very far along in their career that are really good,” he said, “but we have this population that we recruited but we never developed.” 

With the economy growing and about a quarter of the area’s manufacturing workforce set to retire in the next 10 years, employers like Cambridge-Lee now find themselves scrambling for skilled workers. 

Gee, seems like quite a problem - maybe you need to train some more people?

“We said, 'If you want to increase your skillset, pick a class, pay for it, go to it. If you pass, we’ll reimburse you,'” he said. “So I asked, 'How effective was that? How many people did that?' And the answer was none.” 

Why would they go to class in their spare time, he said, when they were working 60 or 70 hours a week? So Fischetti started a new program to send workers to Reading Area Community College. One day a week, they work a half shift and then spend the rest of the day in class, learning how to troubleshoot and repair mechanical breakdowns. The company pays them for their time and travel, and covers the tuition. 

That sounds great! I wonder who is paying for it.

The training isn’t cheap. It’ll cost about $62,000 for the first crop of 16 workers, but Cambridge-Lee will be reimbursed more than half of that with state and federal funds. The company is one of about 20 local employers receiving funding through the Berks County Workforce Development Board to train existing workers.

Something tells me that if Cambridge-Lee lays off workers or closes the plant, neither the state of Pennsylvania or the federal government will get reimbursed. 'Twas ever thus. 

Did 10000 people show up at a Charlotte job fair for Siemens Energy?

(What follows is classic blog material, i.e. an argument about a very small point. But it's in the New York Times, so hey, it matters.)

From a tweet by Derek Lowe, a link to an article by author Jeffrey J. Selingo in The New York Times about vocational workforce training with a rather compelling anecdote: 

When the German engineering company Siemens Energy opened a gas turbine production plant in Charlotte, N.C., some 10,000 people showed up at a job fair for 800 positions. But fewer than 15 percent of the applicants were able to pass a reading, writing and math screening test geared toward a ninth-grade education.

That's a hell of an anecdote - it certainly suggests that there's a problem with North Carolina high school education or the North Carolina workforce. But is it accurate?

Let's start with the provable facts. There is indeed a Siemens Energy facility in Charlotte, North Carolina. This facility was originally there and expanded to include a gas turbine manufacturing line in November 2011. It employs somewhere around 1500 people as of 2012.

However, there is no evidence that I can find (not in the Charlotte Observer or any other North Carolina media outlet) of any job fair being held by Siemens for the opening of this plant. I think that's kind of remarkable, especially since it seems to me that job fairs tend to get a lot of media coverage. It seems reasonable that a job fair being held in 2010 or 2011 or 2012 by Siemens would receive a fair bit of publicity, especially one that received a visit by "some 10,000 people." Those are minor league baseball stadium numbers.

Rather, here's a relevant anecdote by Julie Cook Ramirez at Human Resource Executive Online (written in 2014, emphasis mine):

But when the company sought to expand its Charlotte, N.C., generator and steam-turbine plant to include a gas-turbine facility in 2011, it hit a hiring snafu. 

The expansion required Siemens to hire an additional 1,500 people, nearly tripling its existing Charlotte workforce of 800. Since many of the area's textile companies had shut down, the area was rich with unemployed people eager for a new opportunity. But while nearly 10,000 people submitted applications through the Siemens website, the vast majority didn't have the requisite science, technology, engineering and mathematics -- or STEM -- skills.

So, this story has a similar narrative (our applicants didn't have the skills we wanted), but things have changed - it's applicants to a website. Next, here's a relevant article from Lori Montgomery of The Washington Post describing the opening of the Siemens plant:

State and local officials kicked in millions of dollars in tax rebates to land Project Cardinal. The state also offered $3 million to provide customized training to workers at the new plant. 

More than 9,000 people applied for the jobs; 4,700 were evaluated at state expense, starting with a career readiness test that measured math and reading skills. Those who needed extra help were offered free classes at the community college.

This (Ms. Montgomery's version) makes a lot more sense to me, although her account is not a direct contradiction.

I suspect what actually happened is this: the Siemens announcement was made and the North Carolina state economic development folks (see page 19) set up a website where anyone could apply to work at the plant. Considering that unemployment offices tend to push people to put in applications (especially for mass hiring events like this one), the website got a lot of applicants from 1) unemployed folks and 2) folks with less education. It's not especially surprising that a significant portion of them did not have particularly good math or reading skills. I think Mr. Selingo's anecdote was factually incorrect, and when compared with competing narratives, it loses quite a bit of its force.

(Regarding Mr. Selingo's larger point that "apprenticeships are good" and "college shouldn't necessarily be for everyone", sure, that seems very reasonable. I don't think anyone (outside of higher education administrators, anyway) is arguing against that. That said, it seems to me that states (unemployment offices, economic development offices, community colleges, etc.) already bend over backwards to supply manufacturers with help assessing and training their potential workforces for free. Why should we spot these folks any more goodies? Also, is there any actual evidence that manufacturers are seeing long-term job growth that would support such an investment by the state? My suspicion is "no, not really.")

John Carroll takes it to pharma CEOs

I really enjoyed this Endpoints post about all these pharma CEOs going to the White House and telling the President that they will be hiring people. He then lays out their actual records from the past few years: 

“We’re looking at ways to expand,” Joe Jimenez, CEO of Novartis, told Trump. “One of the things that can help us is a lower tax rate.” 

Novartis is well known as a global player that doesn’t leave a stone unturned when it comes to finding new efficiencies. That cost-cutting spirit drove an R&D overhaul last year, and new programs aimed at doing everything the Swiss company can do to hold the line on costs. That approach has had a big impact on employment. 

Novartis counts FTEs. At the end of 2016 they employed 118,393, 23,037 in the US and 55,205 in Europe. Five years earlier, the score was 123,686 total and 27,242 in the US. The cuts were clearly aimed at its US staff....

Read the whole thing - you'll either laugh or cry or perhaps you'll do both.

(In all seriousness, there is something a little strange about President Trump asking pharma folks to bring manufacturing jobs to the United States, i.e. API plants don't seem to me to be all that labor-intensive. (That said, those jobs tend to have a pretty decent median wage.) Who knows?) 

This L'Oreal suit seems bad for them

Also in this week's C&EN, an article by Marc Reisch on a lawsuit between a startup and L'Oreal: 

Celebrities Taylor Swift and Jennifer Lawrence went blonde using it, and now L’Oreal is charged with stealing it: the formula for Olaplex’s Bond Multiplier, a product that protects hair during bleaching and color treatments. 

The bad blood emerged late last year in a suit filed in federal court for the Central District of California. In it, start-up firm Olaplex charged L’Oreal with violating a patent covering hair protection ingredients discovered by a University of California, Santa Barbara (UCSB), chemist and a former student.... 

...According to the Olaplex suit, polymer chemists Craig J. Hawker and Eric Pressly developed the chemistry for Bond Multiplier in Pressly’s garage. Hawker is a ­professor in UCSB’s department of chemistry and biochemistry and winner of the 2013 ACS Award in Polymer Chemistry. ACS is the publisher of C&EN. Pressly, who currently works for Olaplex, got his Ph.D. in materials science from UCSB and was a member of Hawker’s research group. 

Olaplex introduced Bond Multiplier to stylists in early 2014. Later that year, a L’Oreal-owned firm started to distribute it. Sales were so strong that L’Oreal tried, unsuccessfully, in early 2015 to hire Hawker and Pressly. It then offered to buy Olaplex, the suit alleges. 

By May, talks had advanced and L’Oreal had signed a confidentiality agreement giving it access to Olaplex’s proprietary information. But by September negotiations fell apart. Shortly thereafter, the suit charges, L’Oreal created three “knock offs that it hoped would mimic Olaplex’s success.”

There's something odd to this story, in that I presume that huge multinational corporations don't decide to get into IP disputes with startups unless they can think they can get away with it -- and outside of this lawsuit, it seems like they have. It will be fascinating to see how this ends up proceeding. 

The return of Andrew Liveris

Via Chemical Week, a report of an old bugaboo for the blog (article by Robert Westervelt): 

US President-elect Donald Trump has named Dow Chemical chairman and CEO Andrew Liveris to head his advisory council on American manufacturing. Trump made the announcement at a rally in Grand Rapids, Michigan, on 9 December, calling Liveris a leader “committed to returning jobs to the United States.” 

Liveris announced at the event that Dow will build an innovation center in Midland, Michigan, focused on leveraging silicones technologies across Dow's product line, that will involve approximately 200 R&D jobs in Michigan, including 100 newly jobs while repatriating 100 from other Dow facilities to Midland. “We chose Michigan, our home for more than 119 years, because of the highly skilled workforce in the state and because we believe the incoming presidential administration understands the importance of R&D investment and its multiplier impact on US manufacturing jobs,” Liveris says....

As long-time readers will know, I have disliked a lot of Liveris' rhetoric about the mythical STEM shortage.

It will be interesting to see if Liveris goes elsewhere in the Trump Administration. 

"We just cut what we're going to pay for in the future; we hope you don't mind."

From Delaware Online's Jeff Mordock, a depressing/important bit of news that all current DuPont employees will no longer have access to a company pension (as opposed to a 401k) nor health care nor dental care in their retirement dotage*, this whopper of a statement (emphasis mine): 

Ari Jacobs, a senior partner, global retirement solutions at Aon Hewitt, the company that manages DuPont's benefit programs, said moving from pension plans to defined contribution retirement benefits has become an industry-wide trend. 

"As workers became more transient in the 1980s, they appreciated the flexibility and access to account balances offered by defined contribution plans," Jacob said. "It's been a broad trend and companies have adjusted accordingly."

The amount of passive voice and assumptions in those two sentences is just stunning. I'd rather Mr. Jacobs have said "We think we can get away with this, and we don't feel guilty."

It's important to note that this particular policy change doesn't affect current DuPont retirees. 

Help out an ex-DuPonter with their retirement funds

From the comments, Anon641p has an excellent question (lightly edited for grammar): 

....I came home to mail from DuPont ( I worked for them for 1981 to 1995) that said I can (but don't have to) cash out my defined benefit pension as a lump sum... And I have to decide between Sept 12 and Oct 16 of this year... Obviously this has to do with the merger. 

I would rather take it under the original plan as a little secure longevity insurance, but I wonder, given everything, if that is wise...  

Obviously they are trying to disburse the money in the plan as quickly as possible, which makes me wonder if it will be around in the long run (I have at least 5 years before I retire) 

I know there are other ex-DuPonters that read this blog, I wonder if they have gotten the notice yet and what they are thinking of doing about it...

I suspect that there really isn't much of a difference between the two choices, but I suspect that there are both tax implications and questions as to where the lump sum would be transferred to.

Readers, any help here?

UPDATE: A reader sends in a scan of the attached information sheet. 

A brutal indictment of job retraining

From the Wall Street Journal, an analysis of the counties in the United States that have been most hit by trade with China. The article focuses on North Carolina and the furniture industry and starts with this anecdote: 

Stuart Shoun, 59 years old, has been laid off three times since 1999. After one layoff, the Hickory machinist studied architecture at a community college but then couldn’t find a job and returned to the furniture industry. He makes $45,000 a year, the same as he did nearly 20 years ago and $14,000 a year poorer after adjusting for inflation.

The article goes into more detail on the industries devastated by the switch to Chinese manufactured goods in the United States, and then delves into the details of "trade adjustment assistance":

Government efforts for laid-off workers haven’t helped much. Washington’s formal program to retrain workers hurt by import competition, called Trade Adjustment Assistance, pays for two years of college tuition and extends unemployment-insurance payouts. 

A 2012 evaluation ordered by the Labor Department found that program participants, especially those older than 50, generally made less money four years after starting the program than those who didn’t sign up. The others went back to work more quickly. 

Mr. Shuford, Century’s chief executive, calls the job-relief program a “Band-Aid for an economy that has a sliced artery.”

I am broadly sympathetic to claims that trade is, on balance, good for the United States. But until we actually figure out how to help those who lose their jobs due to trade, I cannot blame my fellow citizens for being skeptical.  

"Dow Announces Actions To Pee On Your Leg, Tell You It's Raining"

From the inbox, a truly remarkable press release from Dow: 

Dow Announces Actions to Drive Economic Growth in Great Lakes Bay Region 

MIDLAND, Mich. – June 28, 2016 – The Dow Chemical Company (NYSE: DOW) announced today a series of actions it will take in collaboration with several state and local economic development and community organizations to spur local employment and bring additional economic development to the Great Lakes Bay Region (GLBR). These actions are intended to help offset the impacts from restructuring measures Dow will implement to enable faster and more efficient growth of Dow Corning’s Silicones business....

It's only down below that you get the gist of what they are saying (emphasis mine):

As a result of the Company’s global workforce reduction targets announced today, approximately 700 roles in the GLBR will be eliminated from the combined companies. These reductions will come from both Dow and Dow Corning, and are part of Dow’s overall cost reduction efforts related to the transaction. 

Notifications to affected employees in the Great Lakes Bay Region will start in the coming weeks, and will continue through the end of the third quarter of 2016. Roles will be eliminated on various timetables throughout the two-year integration period.

Here's press coverage from the Wall Street Journal and also C&EN's Alex Tullo. Here's a few other ways I could imagine rewording the headline for this press release:

1. Dow Announces Actions For Employees To Spend More Time With Their Children
2. Dow Announces Actions To Enrich Shareholders At All Costs
3. Dow Announces Actions For Scientists To Consider Bold New Alternative Careers
4. Dow Announces Actions To Help Employees Work For Themselves, Yay! 
5. Dow Announces Actions To Create Hundreds More Independent Chemicals Consultants
6. Dow Announces Actions To Reinvigorate Bored Michigan Area Unemployment Offices

Your turn! 

Can we just say for a moment how offensive it is that the press release can't even say "we're laying off 700 employees" or "we're firing 700 people", but "700 roles"? Corporate America has refined the euphemism to a Michelangelo-like artform. 

Faster, scientists, do it, do it!

Also in this week's C&EN, an article by Alex Scott on the latest moves from BASF:

“The company needs to adapt its established approaches to changing conditions,” Martin Brudermüller, BASF’s board member responsible for technology, told journalists at a briefing in Ludwigshafen, Germany. “Our research commitment will not increase at the same rate as before, but our commitment to R&D will not go down.” 

One of the ways BASF intends to generate more without increasing spending is by conducting R&D faster. The firm plans to achieve this by, among other things, working more closely with academia and doing away with some lab experiments by first predicting outcomes with the use of computational chemistry. 

“In the future, we will need more computational chemists than lab technicians,” Brudermüller said. 

But BASF is also putting systems in place to ensure that creativity is not sacrificed in the drive for efficiency. For example, the firm recently started encouraging scientists within its central R&D organization to spend 20% of their time working on their own ideas, rather than solving problems for BASF’s businesses. 

“We call these ‘just do it’ projects,” said Bernhard von Vacano, senior research manager for material physics. Such projects might run for just a few weeks. But they are taken seriously, said von Vacano, who heads a team of materials scientists in a new R&D building in Ludwigshafen. 

In line with previously announced plans, BASF will maintain R&D personnel at its Ludwigshafen headquarters at the current level of about 4,900. Any increase in BASF’s worldwide R&D staff—which numbers about 10,000—will be in Asia.

If you clear away all the corporate speak, it is appears that BASF is doing the following:

• Not hiring any more R&D staff anywhere other than Asia. 
• Working with academia more 
• Performing more computational chemistry
• Allowing current R&D scientists time for blue-sky projects

An interesting set of moves - will be interesting to see how this reflects on R&D chemist hiring by BASF in the US. 

Weekend longreads: bosses have no power over phase changes

I have expressed my horror and fascination with the Takata airbag recall, and how it is really deeply about the chemistry of phases of ammonium nitrate (and water content, apparently.) A compelling long article at Bloomberg Businessweek by Susan Berfield, Craig Trudell, Margaret Cronin Fisk and Jeff Plungis is worth your time: 

Ammonium nitrate was about one-tenth the price of tetrazole, according to Upham, who also reviewed industry patents. But ammonium nitrate had a critical flaw that he says led other air bag makers to give up on it: Ammonium nitrate has five phases of varying density that make it hard to keep stable over time. A propellant made with ammonium nitrate would swell and shrink with temperature changes, and eventually the tablet would break down into powder. Water and humidity would speed the process. Powder burns more quickly than a tablet, so an air bag whose propellant had crumbled would be likely to deploy too aggressively. The controlled explosion would be just an explosion. “Everybody went down a certain road, and only Takata went down another road,” says Jochen Siebert, who’s followed the air bag industry since the 1990s and is now managing director of JSC Automotive Consulting. “If you read the conference papers from back then, you can actually see that people said, ‘No, you shouldn’t. It’s dangerous.’ ” 

When Lillie and other Moses Lake engineers met with their ASL colleagues in December 1998 to review a new design using ammonium nitrate, Lillie says they were told the phase stability problem had been solved. He rejected the design nonetheless. ASL wasn’t able to provide documented evidence of the safety of its product, he said in a January 2016 deposition, taken as part of a personal injury suit against Takata and Honda. “Never any evidence, never any test results, never any test reports, nothing to substantiate they had overcome the phase stability problem,” Lillie testified.

Sadly, the bosses at Takata ignored the bad news, and pushed forward. I hope to never be in the situation at the Takata engineers found themselves in, and if I do, I hope I have the courage to speak out.  

I hate this game

The combined management of the DowDuPont merger has forced Iowa, Indiana and Delaware to compete against one another to preserve the agricultural chemistry jobs they have. Here's a comparison of the different incentives offered by the states to DowDuPont from the Des Moines Register's Christopher Doering and Kevin Hardy: 

Delaware: Offered a strategic fund grant worth $9.6 million over five years. Part of that amount includes $3.6 million the company will receive for the creation of 400 jobs. Other strategic fund grants were awarded in the form of matching up to 3 percent of the company’s capital expenditures up to $6 million, which would require the company to spend at least $200 million in the state over a five-year period to receive the full amount. 

The new ag company will be headquartered in Wilmington, currently the home of DuPont. 

Indiana: Officials offered no retention incentives up front, instead focusing on performance-based incentives the company could be eligible for if they create jobs going forward. 

Indianapolis will become a "global business center" for the new company though the company has not said what effect the change will have on the 1,400 employees at the existing Dow AgroSciences, which specializes in crop protection and seed products.  

Iowa: Offered $17,238,000 in state, city and county incentives to the company. Officials say the incentives assure that the company will more or less maintain current staffing levels of about 2,600 in Johnston. But much of the state incentives are tied to the 250 to 500 research and development jobs the company expects to retain. 

Johnston will also become a "global business center," keeping research and development, sales and marketing teams, and business support functions. 

I am amused to read that the director of the Iowa Economic Development Commission considered their incentives "extremely modest."

(I sure as hell hope there was some level of collusion between Iowa, Indiana and Delaware to cap the level of incentives they were willing to offer.)

When I was younger, I used to think the use of public funds to attract corporate investment (and jobs) made a lot of sense. Over the past fifteen years or so, I've changed my mind. It seems that the balance has shifted (as has so many things) in favor of corporations, and playing American locality against American locality on who is more willing to drop their property taxes just doesn't seem wise anymore. I am not exactly a "there oughta be a law" type, but it'd be pretty wonderful if there was a federal law that discouraged this sort of race to the bottom. 

Business guy to former coworkers: I ain't running a charity here - as we have already demonstrated

Kind of an unfortunate angle, I feel
Credit: DelawareOnline
(JENNIFER CORBETT/THE NEWS JOURNAL)

Via DelawareOnline, a recent entrepreneurial event filled with laid-off DuPont employees (article by Scott Goss) was graced with a current DuPont employee: 

Bill Provine, DuPont’s director of science and engineering global operations, provided the group with additional information on how they can apply for permission to access the company’s intellectual property for their commercial ventures. 

DuPont on Friday issued a memo to current and former employees with an email address where they can submit nonconfidential requests related to patent use and product data.
“Looking at our legacy in Delaware, we’re obviously very proud of what we’ve done here and proud of what you’ve done with us,” he said. “We want to be able to support you as you move to those small business enterprises.” 

Any deal of DuPont intellectual property is expected to take the form of licensing or some other arrangement that would effectively turn its former workers into customers. 

“At the end of the day, it’s got to be a mutually beneficial outcome,” Provine said. “Convince us that you’re credible, serious and want to do something.”

He indicated DuPont would not be interested in proposals that seek to resell intellectual property. 

“What we don’t want is for this to be a fishing expedition,” he said. “What we’re trying to enable here is people who have worked on something or are associated with something and want to spin it out into an enterprise.”

There was a response from one of the laid-off technical folks:

Michael Brown, who spent 35 years working in DuPont’s various polymer divisions before being laid off in December, is interested in starting a company based on intellectual property from his former employers. Like many ex-DuPonters who attended Tuesday’s seminar, he declined to discuss his details of his future venture to avoid attracting potential competitors, including former co-workers. 

But Brown did said he wasn’t thrilled by what Provine had to offer. “I’ve got a half dozen patents with DuPont,” he said. “And what I heard here today was the concept of selling the technology to us is not their intent.” 

Brown, meanwhile, said the rest of the program was useful for guiding him to become entrepreneur.  

“I’ll definitely attend a few more of these,” he said. “I’ve always been interested in starting a business of my own. Now have the severance package and lots of time on my hands."

I suppose that I should be somewhat grateful to DuPont that they are offering this opportunity to their former employees, but like Mr. Brown, I'm somewhat skeptical of it all.

Best wishes to the former DuPonters - and to all of us.  

I wonder if layoffs inspire disloyalty...

In the midst of an absolutely phenomenal read by Del Quentin Wilber in Bloomberg Businessweek about a plot to steal DuPont titanium dioxide processes by a Taiwanese businessman, Walter Liew, (in association with a Chinese chemical firm), something that sounds pretty darn familiar...:

They found Tim Spitler, a 49-year-old former DuPont engineer living in Reno, Nev...  

According to the FBI documents, the relationship between Liew and Spitler lasted for years. Liew flattered Spitler, who was bitter about DuPont’s business strategies and its decision in the ’90s to fire thousands of employees. Spitler also admitted to agents that he felt insecure about not having attended a top university (he got a degree from Tri-State University in Angola, Ind.) and was constantly worried about losing his job. Liew made Spitler feel valued and understood. He sent him a gift basket every Christmas, the FBI reports show, and helped pay for the funeral of Spitler’s daughter, who’d committed suicide in 2006. When Spitler would call to thank Liew for his generosity, the businessman would steer the conversation to business and titanium dioxide. 

Spitler provided Liew with information about DuPont’s processes—even sketches of key components—and allowed him to root through boxes in his house and take whatever records he found. Spitler told federal agents that Liew paid him $15,000 for DuPont-related documents, including a blueprint to a plant in Delaware. The schematics provided details of flow rates, pipeline sizes, temperatures, and chemical compositions. As such, it was considered one of DuPont’s most critical trade secrets, U.S. law enforcement officials contend, and Liew used the documents to prove his bona fides to Chinese executives.

Spitler killed himself after Walter Liew was arrested in 2012.

It seems apparent to me that DuPont's reliance on the law to keep their current and former employees from leaking valuable company secrets was not very effective in the face of someone who was a seemingly talented intelligence officer.*

I wonder if a kindler, gentler approach to layoffs may have inspired a little more fidelity. Maybe some day, some company will run that experiment - I am not holding my breath.

*In case anyone is keeping score, it's apparent that of Money, Ideology, Compromise and Ego, it was a combination of Money, Ideology and Ego...

Unofficial RUMINT from Alex Tullo on DuPont

Alex Tullo is C&EN's reporter for the Dow/DuPont merger. From his Twitter account, a comment on the DuPont Central R&D layoffs: 

UNOFFICIAL: of the 270 in DuPont CR&D, 173 laid off, 63 transferred to other business units, and 34 will remain in "Science and Innovation"

Assuming 1) these numbers are accurate, and 2) that I understand this correctly, this is a 64% reduction in Central R&D headcount? That sounds terrible and essentially a capitulation of DuPont's long-term R&D model. Yeesh. 

DelawareOnline: "DuPont lays off 200 Experimental Station researchers"

From an article by Jeff Mordock and Scott Goss, the same DelawareOnline reporters from yesterday, more details on the first day of layoffs at DuPont: 

DuPont Co. laid off about 200 scientists in its Central Research and Development division at the Experimental Station on Monday, according to sources familiar with the facility's operations. 

Those job losses, said to include doctorate holders and technicians, account for nearly half of the Experimental Station's central research staff. DuPont's two core research and development functions – material sciences and molecular sciences – were said to be gutted, reportedly leaving only 16 doctorate holders among the two business units... 

...All Delaware workers laid off by DuPont will receive a separation package, career placement services and training allowances based on years of service, company officials said. 

According to DuPont workers, that package that includes a minimum of two months' worth of full pay with an additional month's pay for every two years of service, up to a maximum of a 12 months. The workers also reportedly are eligible to receive a pre-approved $5,000 training allowance, along with a year of so-called COBRA medical and dental coverage at employee rates... 

...Bob Strong, deputy principal assistant at the state Labor Department, said the agency is hoping to send rapid-response teams to meet with DuPont workers by the end of January.
Those teams will provide workers with detailed information about collecting unemployment when their severance packages expire, along with job training and certification assistance, he said. 

"We're expecting to provide general information to employees in advance and then hold multiple events, each with about 200 to 300 staff members, where we can provide more specific details and really drill down on their questions and concerns," he said. 

"In the meantime, we've developed a survey that will help us match each worker's job title and skills to available positions throughout the state and get a better idea of what assistance these folks think they'll need."

I am so sorry for those affected. Some questions I wish I knew the answers to:

• What percentage of laid-off DuPont workers will be able to find work in chemistry in the area? (broadly speaking) I feel like the Philadelphia area (GSK, Rohm and Haas/Dow, Merck) have already been very hard hit over the last ten years, with no palpable resurgence. 
• What percentages of these laid-off scientists will be able to find work in chemistry at all? Are other markets (Boston, say?) booming enough to absorb these folks?  
• When you have a highly technical workforce like this one, do the surveys and such from state unemployment offices actually help? 
• What does this mean for layoffs for Dow? 

A failure on the part of the American Chemical Society over the past five to ten years has been its apparent unwillingness to study the simple social science around layoffs of its members, especially in mass layoffs (like this one) or site closures (like the Ann Arbor Pfizer site, or the Roche Nutley site.) We can do better, and we should. 

Once again, best wishes to those affected, and to all of us. 

DelawareOnline: 1 in 4 DuPont jobs in Delaware to be cut; DuPont management responds in C&EN

From the inbox, a story from DelawareOnline's coverage of the DuPont layoffs today (warning, annoying autoplay) (article by Jeff Mordock and Scott Goss):

...Ron Ozer, an engineer at the DuPont Experimental Station near Alapocas, lost his job Monday after nearly 25 years with the company. He described the atmosphere among DuPont workers as "depressing." 

All employees at the Experimental Station had a one-on-one meeting with their supervisor to learn whether or not they will remain with the company, according to Ozer, an Arden resident. The meetings were said to have begun in the morning and continued through late afternoon. 

The people who are staying aren't exactly happy, either," Ozer said. "It's not like people came out of those meetings and said, 'Yeah, I've got a job.' They are coming back to a very different organization." 

Ozer said workers were not informed how many jobs were cut Monday. Despite the company's recently announced plans to cut more than 1 out of every 4 jobs in Delaware, Ozer said he was still caught off-guard. 

"I can't help but say I was a bit surprised," the investigative researcher said. "I guess I thought I was safer than I was." 

Some DuPont workers who received layoff notices are expected to remain with the company through the end of next month....

Man, that is terrible. Best wishes to them, and here's hoping that all of them find employment soon.

Also, a not-very-believable non-denial denial explanation of DuPont R&D massive layoffs reorganization from its chief science & technology officer, Doug Muzyka (article in C&EN by Alex Tullo):

...Muzyka claims recent media reports have “mischaracterized” the changes at DuPont by maintaining that “corporately funded R&D is being completely eliminated, or that the cost reduction effort at DuPont is targeting R&D.” 

As part of the R&D restructuring, he says, “we are redesigning the existing Central Research & Development operating model to assess and seed new, transformational science-based ventures as the next step in the evolution of corporately funded R&D for DuPont.” He adds that some staff from Central R&D and engineering will transfer to DuPont’s business units. 

Muzyka also says the R&D budget impact associated with the cost reduction program is in line with the overall program, which aims to cut the firm’s global workforce by 10%. “DuPont will continue to be a leading investor in industrial research and development,” he says. 

The changes, Muzyka adds, will position the company for its merger with Dow and the subsequent breakup of the new DowDuPont into three separate companies. 

“DuPont remains fundamentally, deeply committed to scientific innovation,” Muzyka says. The cuts are the result of “careful analysis of how we can improve the overall productivity of our R&D functional company-wide.”

I wish these executives showed a hint of humanity in their corporate-speak. I wonder when it leaves them? Or did they ever have it? 

BREAKING: DuPont to cut 1,700 jobs in January

From both C&EN's Alex Tullo and DelawareOnline's Scott Goss (text below is from Scott Goss):

DuPont will eliminate about 1,700 job in Delaware in early 2016, the company announced Tuesday. 

CEO Ed Breen announced the layoffs in a memo sent to DuPont’s roughly 6,100 Delaware employees on Tuesday. 

The job cuts include employees who were told earlier this month that their jobs were being cut, along with several hundred who will received notification in January.
The workers will depart the company by the end of March. 

Breen said he chose to announce the full impact now – before those remaining employees receive a pink slip – because DuPont is required to detail the layoffs in a state filing due by Dec. 31. 

“Especially given that we are in the middle of the holidays, we would have preferred to wait until individual notifications were complete before reporting the full local impact,” Breen wrote in the memo. “… I wanted you to hear the difficult news – directly from me …”

Best wishes to those affected.

UPDATE: From Philly.com's Joseph N. DiStefano, an e-mail from a CR&D scientist (thanks, Anon318p). Mr. DiStefano's annotations are italicized:

We will hear what happens to all of Central Research and Development [CR&D], on January 4th. Three options: 

1. Laid off --  ~80% of CR&D will get this. Of the 250 principal investigators [PIs, with PhDs] plus associate investigators [AIs, with BSci, MSci degrees], about 17 PIs plus 34 AIs will be left.
(But of that 80%, some will stay with DuPont in other jobs, another company source says. That leaves option 2:) 

2. Pulled into a business... (But) the businesses are laying off staff.
(And then there's option 3, for the minority who keep their jobs in the renamed Central R&D unit): 

3. Be part of "Science & Innovation," the new CR&D.  

Five of the seven CR&D managers have been let go. 60% of the patent group in CR&D, IB and other businesses have been cut... 90% of Pioneer (crop seed R&D) was laid off, 200 people -- a week before Christmas -- what a great holiday present!  The other 10% were told to move to Iowa or else they would not have jobs. 

We have been told not to work in our labs. We have been told just to make certain all of our chemicals are labeled (for disposal).  

And we have been told that we have a day to collect our personal belongings and get out [off site permanently by Jan 5th].  

So I am here "working" most of this week  -- removing my personnel effects... Jan 4th (I will) learn my fate... Looking at academic positions, consulting... 

There will be a lot of good people looking for jobs. 

My heart goes out to those folks that are at mid-career and do not have the "cushion" of retirement. 

I found one AI almost crying in the hallway last week.  

It will be terrible to be here on Jan 4th. 

NO ONE would have predicted what is happening now at DuPont just a couple of months ago! 

Ed Breen and Nelson Peltz can take credit for destroying one of  the best industrial research organizations in the world. 

I will agree that there were issues. But you fix things, not destroy them. That is what real leaders do. 

Dupont does a terrible job marketing. It is the interface between marketing and technology development that had been broken. -- So you destroy the technology organization? Not!   

If you have a leaky roof -- do you burn down the house? 

It is just so surreal!!

Holy cow.  

Tim Cook is Wrong: The US has many tool and die makers

In the midst of a 60 Minutes piece on Apple's products and manufacturing, this whopper of a statement from Apple CEO Tim Cook (emphasis mine): 

And most Americans would be surprised to know that nearly all Apple products are manufactured by one million Chinese workers in the factories of Apple contractors, including its largest: Foxconn. Yet Tim Cook insists that China's vast and cheap labor force is not the primary reason for manufacturing there. 

Charlie Rose: So if it's not wages, what is it? 

Tim Cook: It's skill. 

Charlie Rose: Skill? 

Tim Cook: It's skill. It's that Chi-- 

Charlie Rose: They have more skills than American workers? They have more skills than-- 

Tim Cook: Now-- now, hold on. 

Charlie Rose: --German workers? 

Tim Cook: Yeah, let me-- let me-- let me clear, China put an enormous focus on manufacturing. In what we would call, you and I would call vocational kind of skills. The U.S., over time, began to stop having as many vocational kind of skills. I mean, you can take every tool and die maker in the United States and probably put them in a room that we're currently sitting in. In China, you would have to have multiple football fields. 

Charlie Rose: Because they've taught those skills in their schools? 

Tim Cook: It's because it was a focus of them-- it's a focus of their educational system. And so that is the reality.

So there are two claims here. The first claim is that the US has very few tool and die makers.

That is false. According to the Bureau of Labor Statistics, the United States has somewhere around 75,000 tool and die makers. Maybe these aren't the folks that Tim Cook is looking for? Maybe these folks make too much money for him to hire? Maybe there aren't enough for Apple?

But he is wrong: there are many, many tool and die makers in the United States.

Regarding the second claim: I would like to hear if it is true that manufacturing skills are emphasized in the Chinese educational system. Something tells me this is wrong. Readers, your thoughts?

UPDATE: This Marketwatch commentary (thanks, Anon1221p) notes that there were fewer tool and die makers in the US in 2014 than there were in 2004. Sure hope that number turns around, and that Apple is a part of it.