This week, Motor City giant GM started its layoffs of blue and white-collar jobs in North America in a move to greatly reduce spending and prepare the automaker for an expected slowdown of sales in the automotive market in coming years. Overall, GM is looking to cease production of six passenger car lines that include the Cadillac flagship, the CT6 sedan, and the Chevy Volt, GM’s first plug-in hybrid vehicle.
While this is happening, GM also made an announcement this week that they were adding 1,000 workers to their plant in Flint to prepare for the production of their new Silverado HD and GMC Sierra HD. Further, in response to the 2,800 hourly-workers GM is laying off in North America, GM says there are 2,700 positions open to those workers working on the new heavy-duty trucks, and GM also claims that 1,200 of the 2,800 layoffs are retirement-eligible employees, which may potentially open up more positions in Flint or elsewhere for the workers being laid off. So, with that being said, is the Detroit area gaining jobs, losing jobs, are breaking even?
According to GM President Mark Reuss, so far 943 workers being laid off at North American GM plants have already accepted job transfers to other facilities, more than 600 of which will be working on the new trucks in Flint. In an effort reduce its workforce voluntarily, buyouts were offered to 17,700 employees at plants that are looking to stop product allocation, however, the acceptance rate initially was low. Although the number of workers accepting buyouts has increased leading up to this week, GM is still expected to hand out thousands of pink slips to North American workers to meet its goal.
Unfortunately, even with the 2,700 job transfers available and 1,000 jobs being added to GM’s Flint plant, it seems that overall jobs in North America, and in the Detroit area, will be lost. Estimates suggest that at least an additional 4,000 or so hourly and salary employees in North America will need to be let go for GM to reach its downsizing goal. Although GM is offering severance packages to the employees it needs to cut, documents from the Detroit Free Press suggest that these packages aren’t the safety nets employees were hoping for.
According to an article by the Detroit Free Press, GM employees that have been with the company for a year or less are only receiving two weeks’ severance pay. Employees that have been with GM for two years will receive a month’s pay in severance; those that have been with the company for 3 years will receive six weeks’ pay in their severance package. Those that have been employed by GM for 12 years or more will receive six months’ pay upon them being let go. One employee that was laid off shared that she was receiving three months’ insurance after being let go and is able to keep her company car until the end of the month, where she will have the option to purchase it. GM is looking at cutting “level 6 and 7” non-management positions and college hires in the Detroit area, as well as targeting the engineering division out in Warren. Although these layoffs and severance packages aren’t necessarily out of the ordinary, they certainly aren’t anything to write home about.
Overall, it looks as if the Detroit area and other North American regions will in fact be losing jobs with the GM layoffs in effect right now. Hopefully the production of their new heavy-duty trucks and future electric and autonomous vehicles prove to be successful enough to open more jobs again in North America to keep up with production. Until then, however, we will have to wait and see what happens.
Holbrook Auto Parts has proudly provided citizens of the Detroit area with jobs and trustworthy automotive service and parts for over 75 years. We hope to see GM and the rest of the Motor City pick up sales and production in the future, bringing more jobs into and around the city and restoring the Motor City to its past glory.
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