Insight Point: The recent layoff of almost 900 workers by General Motors (GM) and Ford due to the expansion of the strike announced by the United Auto Workers (UAW) union highlights the negative impact of labor disputes on employees and the economy.

GM announced that it is laying off 164 workers at stamping plants in Parma, Ohio, and Marion, Indiana, which normally supply stamped metal parts to the assembly lines affected by the strike. The strike has shut down plants in Wentzville, Ohio, and Lansing, Michigan, where vehicles such as Chevrolet Colorado and GMC Canyon pickups, as well as Chevy Traverse and Buick Enclave pickups, are manufactured. However, most workers in Parma and Marion will continue to work, producing stamping for other plants that are still operational.

GM’s previous layoffs at other facilities, including the Fairfax assembly plant in Kansas City, Kansas, the Toledo engine plant, and the Lockport components factory in New York state, have now resulted in nearly 2,000 workers being affected across the five plants. Similarly, Ford has laid off approximately 1,300 employees since the strike began, including an additional 400 workers from two plants in Michigan.

The UAW’s targeted strike strategy has had a ripple effect on facilities that are not directly targeted for a work stoppage, leading to layoffs at Ford’s Chicago Stamping Plant, Lima Engine Plant, and Michigan Assembly plant in Wayne, Michigan. Stellantis, which produces vehicles under the Jeep, Ram, Dodge, and Chrysler brands, has not announced any additional layoffs, as the UAW did not expand the strike to additional Stellantis locations.

The UAW has criticized the layoffs, stating that they are an attempt by the automakers to pressure union members to settle for less. The union argues that with the record profits of the Big Three automakers, there is no need to lay off any employees. The UAW has pledged to ensure that any worker laid off will not go without an income.