What are the potential drawbacks of two-tier structure

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To the degree job growth (and increased car sales that come from more competitive labor costs) is based on two tier-wage structures, how sustainable is this approach? Consider, for example, that Fiat and Chrysler CEO Sergio Marchionne state that "Long term, (the system) is not a viable structure. It creates two class of workers within the plant, It doesn't work in the same direction we are working ... to get this organization to work in unison." Why would Mr. Marchionne make this statement? What are the potential drawbacks of a two-tier structure? When would we expect any such drawbacks to materialize?

Reference no: EM13845475

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