Europeans worry less about GM layoffs

Marketplace Staff Jul 10, 2009

Europeans worry less about GM layoffs

Marketplace Staff Jul 10, 2009


TESS VIGELAND:Bankruptcy mechanics came out from under the hood of General Motors on Friday. The company engineered a remarkably quick exit from Chapter 11 after reaching a deal to sell off a chunk of its assets. One of those assets is GM’s European division, Opel. About 10,000 jobs will probably disappear once the sale is finalized, just like what’s happened on this side of the pond.

Reporter Brett Neely went to Antwerp, Belgium to find out what happens next for GM workers across the Atlantic.

Brett Neely: The story of Belgian autoworker Bjorn Wauters will sound familiar to many of his American counterparts. He was 22 when he started working in the paint shop of the local GM factory. That was nearly 10 years ago. Bjorn went to work for GM because his father worked there. It seemed like a good job.

Bjorn Wauters: Because I thought, “Yeah, well, this will be the employer until my retirement.” Straight off, they started restructuring and everything.

Just like many car factories in the Midwest, the Antwerp factory’s best days are past. Twenty years ago, there were 13,000 GM workers here. Today, Bjorn is one of just 2,600 who are left. The plant may not survive the next round of cuts.

Wauters: There’s definitely something coming, but we are not worrying. Well, we are worrying, of course, but we’re not speculating.

Though workers on both sides of the Atlantic have the same sense of uncertainty, there are big differences in their situations. In Belgium, like most European countries, there’s universal health care. Pensions are paid by the government, even if that comes at a cost. Taxes are high here, around 50 percent of earnings.

But former GM workers in Antwerp aren’t worried about their pensions and health-care benefits disappearing, as they might be in the U.S.

At an employment office in central Antwerp, a dozen former GM workers are having a monthly meeting. They’re supposed to talk about looking for jobs. Mostly, they’re shooting the breeze. I asked them how the job hunt is going.

Former GM worker: That’s a delicate subject!

They’re not really looking for work. Because they’re all over 50 and had 30 years of service, these workers snagged a special early retirement deal. They get long-term unemployment from the government, about $1,500 a month after taxes. Plus, they receive what’s called a “bypass.” Basically, GM kicks in about $700 a month. In the end, they receive about 70 or 80 percent of what they made while on the assembly line — for doing nothing.

It’s a pretty good deal, says retiree Maurice van de Muerebukel.

Maurice van de Muerebukel: I’m very busy, I’ve got a lot of hobbies. I’m going to fish. I’m going to ride bike. I do a lot of things.

The dark cloud on the horizon is that the factory here could close. Then these retirees would lose their bypass payments, the 700 bucks. Still, they’d keep their unemployment benefits.

Brigitte Blomme is an employment counselor who helps the early retirees. She says GM’s early retirement plan is, in some ways, a set of golden handcuffs for the workers.

Brigitte Blomme: Because they have too much money for doing nothing. So they say, “If I am going to work, the difference is maybe 200 euros, then I’m working for 200 euros.”

She says despite the recession, there are still plenty of jobs in Antwerp, even for 50-something factory workers. Belgium’s unemployment rate is just 8.2 percent — below the U.S. rate of 9.5 percent and below the average in Europe these days.

The fact that there are other jobs out there removes stress from workers of all ages. I asked Bjorn Wauters whether he worried about losing his job at the GM plant.

Wauters: Ummm, well, mmm, worried? No, I’m not actually worried. If it closes, which I actually don’t imagine, but if it closes down, then I’ll go look for another job, eh?

Even if he can’t find one, Bjorn will get generous unemployment benefits — about 60 percent of his income for the first year, though it drops a little after that. Bjorn says Belgian workers are lucky to have this level of social protection. And he sympathizes when he reads about his counterparts in America, who are having a tougher time.

Wauters: One day you have a job and the other day you’re in poverty. And also entire cities that get depopulated because a factory closes. Well, we don’t have those things here.

But like his American colleagues, Bjorn Wauters’ fate isn’t in his hands. Any day now GM will sign a deal to sell its European operations to a new owner, who may decide to close the Antwerp factory.

In Antwerp, Belgium, I’m Brett Neely for Marketplace Money.

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