Future Uncertain for Auto Workers' Safety Net
Members of the United Auto Workers union enjoy a one-of-a-kind deal with U.S. car makers: Idled workers do community service or watch videos and play cards -- all while earning full pay. But the Jobs Bank program is likely to be a contested issue in contract talks next year.
Paying workers not to make your product would seem a costly proposition for any company. But the Big Three carmakers have been doing just that for years. The little-known Jobs Bank program pays thousands of autoworkers who lost their jobs due to outsourcing or changing technology.
Ford has 1,100 workers in its jobs bank. Analysts estimate General Motors has more than 5,000. But GM CEO Rick Wagoner has said his company can't keep up with the costs, which he says runs to $400 million a year.
Auto executives agreed to the jobs bank in the mid-1980s as part of their contract with the United Auto Workers. At the time, they thought workers would only stay there temporarily. But for some GM workers, the jobs bank has become a way of life. People have spent 15 years in the program -- more time than they've spent actually making cars.
Because of lost market share, Ford and GM plan to eliminate a total of 60,000 jobs in the coming years. Analysts say they'll probably have to offer early retirement packages to keep the Jobs Bank from ballooning.
Doug Brown, an idled worker who once built GM's prototype cars, has worked at the R.E. Olds Museum in Lansing, Mich., for three years. But he thinks the program won't last. "I think probably the next contract, they might make some alterations to it," he said. Even as he predicts the plan's eventual demise, Brown says he won't miss it. At 65, he plans to retire this summer.
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