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How a smartphone saved 1,000 jobs

Rick Newman
Columnist

A picture is worth a thousand workers.

It’s a moving picture, but still—a picture.

On Feb. 10 of this year, supervisors called workers together at a Carrier factory in Indianapolis. The news was bad: Carrier would be shutting down the plant, starting in 2017, and moving 1,400 jobs to Mexico.

The announcement was big news in Indiana, which had fought hard to keep Carrier by offering tax breaks and other incentives. Beyond the state’s borders, however, hardly anybody noticed. US employers announced more than 60,000 layoffs that month, and 1,400 job losses at one plant was hardly national news.

But two days later, a Carrier employee named LaKeisha Austin posted a three-and-a-half minute video to her Facebook account showing Carrier workers revolting as a man in a suit recites a corporate statement about the move. Workers shout and swear at him, and sneer when he says, “this is strictly a business decision.”

The video promptly went viral, making the Carrier layoffs a national story. CNN picked it up right away, as did most other news organizations. The video caught on for a couple reasons. First, it was a rare instance of a recording capturing the exact moment workers learn their employer plans to dismiss them. Second, the contrast between a monotone corporate boss reading a statement from a podium and rambunctious workers in jeans and sweatshirts suddenly fearing for their future was an almost perfect microcosm of economic changes that have been roiling the middle class for well over a decade.

Donald Trump saw the video like millions of other Americans, and commented on it the very day it became public. On the campaign trail during the following months, he referred many times to Carrier’s move to Mexico, telling voters that he was the only candidate who understood what was going on in the offshored economy, and the only one who would do something about. Given that hundreds of companies have announced job cuts this year, it seems safe to say Trump would not have fixated on Carrier if not for the gripping video shot by a worker who happened to pull out her smartphone at an opportune moment.

That video has now led to a remarkable reversal by Carrier, which says it will keep nearly half of the jobs in Indiana that it had been planning to move to Mexico. Some will be at the Carrier plant where the video was shot, and others will be at the factory of an affiliated company. Overall, roughly 1,000 Indianans will end up keeping jobs they otherwise would have lost. The turning point came when Trump himself, now the president-elect, chose to negotiate directly with Carrier to find a way to prevent some of those jobs from disappearing.

Trump’s intervention in the business dealings of a private-sector company is troubling and controversial, because it distorts the efficient allocation of capital and other principles that normally guide business decisions. But business decisions become political controversies when they harm enough people, and that’s when business principles go out the window. In Carrier’s case, one short video transformed a business matter into a political brouhaha, which led to a totally different outcome. Watch out for those smartphones, bosses.

Rick Newman is the author of four books, including Rebounders: How Winners Pivot from Setback to Success. Follow him on Twitter: @rickjnewman.