The W$J editorial page excoriates GM for its "job bank":

[The] "jobs bank" ... is the company's euphemism for a post-employment limbo in which GM pays laid off members of the United Auto Workers not to work. If you want to know why GM's costs are too high for the number of cars it sells, here's one explanation.

GM doesn't like to talk about the "jobs bank," to the point that it won't disclose how many idled workers are in the bank or even how much it costs the company. However, the Detroit Free Press has dug around and reported that the "bank" holds some 5,000-6,000 employees, at an annual cost of as much as $800 million a year. And that's just the beginning of the damage it does.

The jobs bank was created in 1984 at a time when it became fashionable to worry that automation would cause robots to replace workers on factory floors. So in exchange for the right to introduce productivity improvements in factories, GM, Ford and Chrysler all consented to jobs banks. The idea was that in exchange for educating themselves, doing community service or in some cases just sitting around a factory, workers would continue to collect pay and benefits until the automaker could find another job for them.

This is one of those stories that I read and think, there must be more to this. Or maybe not. The W$J tells the story of a worker who is scheduled to retire in about four years, having spent 10 of his 30 years at GM "in the bank." As I have said here repeatedly, GM's CEO Rick Wagoner took over a company with some serious structural obstacles to reform, and this looks like one of those. The job bank is part of the UAW agreement, which will not expire until 2007.

And you thought academic tenure was cushy!

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