Automotive News has an article looking at the devastating effects of GM’s financial problems on the city of Pontiac, where the number of auto manufacturing jobs has been in steady decline. The loss of jobs has all but bankrupted the city and sent the unemployment and foreclosure rates through the roof.
GM said on June 1 that by October it would close a truck plant in Pontiac that employs 1,100 people. A GM stamping plant employing another 1,100 has been idled indefinitely.
At its peak, GM employed 30,000 hourly workers in Pontiac in the 1970s. After its latest cuts, the company’s total hourly workforce will barely top that figure…
Even before June 1, the city was in a pickle. Unemployment hit 27.2 percent in April, more than three times the national rate of 8.9 percent that month. Property and income taxes have fallen and there were 1,000 home foreclosures in 2008.
Pontiac’s budget has a deficit of $7 million, prompting Michigan Gov. Jennifer Granholm to appoint an emergency financial manager in March to clean house. The GM plant closure makes that job harder.
“Sorting out our finances now is like trying to climb a glass mountain wearing greasy socks,” Mayor Phillips said.
Pontiac is not alone, of course. Flint is in much the same condition.