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JUDY WOODRUFF (Newshour): Now, as the unemployment rate remains stuck above nine percent, NewsHour economics correspondent Paul Solman looks at a Cleveland company that has handled economic turmoil very differently. The manufacturer hasn't laid off anyone for economic reasons since World War II.
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FRANK KOLLER (Journalist): Income security implies that, if you're hired for a job, you're guaranteed a certain hourly wage, let's say, in an auto factory in Detroit. The idea of employment security is that you will always have employment, but that, in tough times, because the company is not doing so well, your income is going to decline, and that, in good times, it will increase again. Now, ultimately, the idea of income security won out.
PAUL SOLMAN: As did, on Wall Street, the idea of income for shareholders.
Harvard Business School Professor Norm Berg, who's taught Lincoln as a case study for decades, says Wall Street's increasing stress on maximizing shareholder value has fought the profit-sharing/no-layoff model.
NORMAN BERG, Harvard Business School: If you ask the financial community, they would say this is practically traitorous. It's like a bumblebee. It's not supposed to fly, you know?
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PAUL SOLMAN: And, yet, here's the actual bottom line. For more than a century, Lincoln Electric has made money the old-fashioned way and is on track for $200 million in profits in 2011, while offering its workers essentially lifetime employment in still somewhat rusty Cleveland, Ohio.
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