Since the auto industry “bailout” in 2008, after receiving a reported $13.4 billion in short-term financing through the Troubled Asset Relief Program, General Motors (GM) survived another decade without having to make major cuts. Except this time, the cuts are not only to its employees, but its product line as well. GM is set to lay off 15% of its salaried workforce, consisting of approximately 8,000 workers and 6,000 hourly jobs. In October 2018, the company offered to buy out 18,000 workers. The company has 180,000 employees worldwide.
Beginning at the end of 2019, GM will close plants in Maryland, Michigan, Ohio, Canada, and South Korea along with discontinuing models such as the Chevy Cruze, Buick LaCrosse, and Cadillac CT6. The purpose for the cuts is to become more efficient. Some skeptics say this should have happened before the bailout in 2008 instead of using government (tax-payer-funded) money to continue operations in the red.
Ford has also made a similar decision to stop producing most cars to focus on SUV and pickup truck production instead. They are also expecting massive layoffs. Its stock is down 29%, and the new tariffs have reportedly cost the company $1 billion. Many will argue that the jobs should have been kept in the U.S. to begin with, then the tariffs would have had little to no affect on companies such as Ford.
Just as in 2008 when the auto industry jolted the economy, soon to follow was the mortgage/housing industry. Those who were laid off, some employees for 20+ years, were lost and confused. It became extremely difficult to find suitable employment at such short notice and when the major economic drives of the nation were all doing major layoffs to their workforce. The competition became fierce, and many people lost their homes and possessions in the midst of this economic turmoil.
If you are an employee for one of these automakers or another industry such as the housing/mortgage space that may see a similar impact soon to come, it’s always a good idea to be prepared ahead of time. Plan your exit strategy now, identify new opportunities in advance, and prepare a resume to keep the edge over the competition. Believe me when I tell you, I’ve seen what happens when tens of thousands of people are not prepared for massive layoffs and panic. Get prepared now!