General Motor’s announcement that it plans to idle five North American factories and cut 14,000 jobs has sparked much discussion in the media and outrage in Washington. While the job losses are a terrible blow to those workers and the families they support and the local economies where the factories are located, the decision could prevent the kind of crisis that resulted in it seeking bankruptcy protection in 2009 and a $50 billion bailout by the U.S. government. It is far better for GM to reallocate resources now, while it is healthy, than to wait until it is in trouble. And the same applies to the affected workers: The tight labor market means there are opportunities for those who go through retraining.
The Challenges GM Is Facing, and the Reasoning Behind Its Plant Closures
Delaying may not have been good for the company or its workers.
November 30, 2018
Summary.
General Motor’s announcement that it plans to idle five North American factories and cut 14,000 jobs has sparked much discussion in the media and outrage in Washington. While the job losses are a terrible blow to those workers and the families they support and the local economies where the factories are located, it is a wise decision that could prevent the kind of crisis that resulted in it seeking bankruptcy protection in 2009 and a $50 billion bailout by the U.S. government. It is far better for GM to reallocate sources now, while it is healthy, than to wait until it is trouble. And the same applies to the affected workers: The tight labor market means there are opportunities for those who go through retraining.