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GM Cutting Contract Workforce

October 1, 2008
Related Topics: Downsizing, Retirement/Pensions, Future Workplace, Latest News
General Motors began making job cuts among the ranks of its contract workers yesterday, September 30.

“We are in the process of advising several temporary agencies that we are continuing to eliminate some contract jobs,” GM spokesman Dan Flores told Automotive News, a sister publication of Workforce Managment. He declined to say how many workers or the GM sites that are affected.

In a statement, he said, “The reduction is part of the continuing streamlining of our North American operations.”

The reduction in GM's contract staffing is part of a bigger effort to reduce the automaker’s overall costs, sources familiar with the initiative told Automotive News. The number of contract workers who will be dismissed is unclear, but it could be several hundred, one source said. 

Separately, the automaker is trimming its salaried job costs by 20 percent. To meet that goal, GM needs to eliminate about 15 percent of its U.S. salaried jobs—or about 5,000 of the existing 32,000 positions, a source said.

The goal also includes other cost-reduction actions such as eliminating health care coverage for U.S. salaried retirees older than 65.

GM is trying to trim the salaried jobs through voluntary means. In late August, retirement offers went out to salaried employees. The sign-up deadline for that program is early October. Participants would leave the company by November 1.

If GM fails to meet its cost-reduction goal with the voluntary program, executives may consider involuntary job cuts, a source said.

Filed by Amy Wilson and Robert Sherefkin of Automotive News, a sister publication of Workforce Management. To comment, e-mail

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