Comments on: How Much Are GM's Labor Costs?

By: acura parts

acura parts — Wed, 01 Apr 2009 06:55:20 +0000

GM will lay off another 1500 employees. Hopefully they can go back in normal operation.

By: dragdreams

dragdreams — Tue, 31 Mar 2009 23:55:20 +0000

GM will lay off another 1500 employees. Hopefully they can go back in normal operation.

By: kustomatic

kustomatic — Wed, 18 Feb 2009 02:17:43 +0000

GM got so many excess expenses that they don't need at all. let say they got 2000 employees with $73. They will spend $173,000 every month. We all know that GM got more than 2000 employees.

By: K-Rock

K-Rock — Fri, 12 Dec 2008 13:44:56 +0000

I agree that bad business decisions have been made for decades. I don't agree the blame falls squarely on the shoulders of management of the companies however.

Union management along with Corporate management made bad deals along the way that has caused the companies to tank. The union mentality that every line worker should be paid like they hold a Masters Degree is insane.

Union management played a major role in forcing corporate management to agree to terms that could in now way shape or form allow the company to survive long term.

The Big Three are similar to the US Social Security System where as people retire the current workers are paying for people who no longer are employed with the company. It is fine when you have 1 retiree for every 3 workers, not so good when the reverse is true.

By: Jen

Jen — Sat, 22 Nov 2008 17:23:29 +0000

Whenever I attempt to respond to this, it turns into a long essay. I'll try to keep it short and say that obviously I am not against BK; I actually think the car companies need to go there because they have been so poorly run for decades that an infusion of taxpayer dollars at this point would be a lost cause.

However, let's be clear that it isn't the guys on the line earning $28/hr (which by the way is 58k/yr, which will support a family in a lmid to ower middle class lifestyle) that ran the company into the ground.

The whole $70/hr thing strikes me as something that has been latched onto by some (no matter how incorrect the numbers are) precisely because it tends to shift the attention and blame from the bad business decisions made for decades by mgmt to the the workers.

By: Will Wilkinson

Will Wilkinson — Sat, 22 Nov 2008 00:11:50 +0000

If you are supposed to be a for-profit corporation, then obviously yeah. Are you against bankruptcy protections in general? The core mechanism of which is allowing individuals and firms to renege on promises. Or are you saying that taxpayers should be made to meet promises they never made?

By: Jen

Jen — Fri, 21 Nov 2008 22:04:42 +0000

Yes, cuz paying a bunch of people who gave you the best 30 years of their lives the benefits that you promised in order to induce them to do so is “wasting a ton of money.”

By: Jane Galt

Jane Galt — Fri, 21 Nov 2008 19:34:48 +0000

Meh, costs are costs & labor is most expendable. Slash them.

By: Bernard Yomtov

Bernard Yomtov — Fri, 21 Nov 2008 16:52:58 +0000

No one is saying that CURRENT workers make $70 per hour.

Actually, lots of people are saying that. And the difference is highly relevant. The liability to the retirees is a fixed cost, much like interest charges on debt. It doesn't grow as GM builds more cars.

By the way, I think a little heftier apology is in order, not this "gee I didn't mean it" stuff. When an obviously implausible fact comes your way, don't you have an obligation to verify it before passing it on?

By: save_the_rustbelt

save_the_rustbelt — Fri, 21 Nov 2008 16:34:05 +0000

A rather serious abuse of cost accounting, because the number is used to justify cuts in current workers' pay and benefits.

If journalists and economists are going to play at accounting and finance they should probably have a clue.

Toyota and Honda will simply dump their retirees' costs on the U.S. government, a much overlooked fact (the workers' 401 (k) plans are melting down as you read this).