International Business: The New Realities, 5th Edition

Workforce Reduction and Employee Termination

When firms experience downturns or rising input costs, they may resort to workforce reduction to maintain profitability. During the most recent global economic recession, deteriorating conditions forced many firms to lay off workers. General Motors (GM) closed an auto plant in each of Australia and South Korea as part of restructuring global operations. Closure of the GM Holden factory in Adelaide led to the loss of 1,600 jobs, which were transferred to lower-cost plants abroad. Closure of the GM Gunsan plant in South Korea resulted in the loss of about 2,000 jobs.31 Automation and the growth of Amazon, Alibaba, and other online retailers will result in the loss of millions of jobs in the brick-and-mortar ...