Keeep spending local, says small business expert after GM Oshawa cuts third shift, 500-plus jobs

Keeping spending local is one way residents in Oshawa and Durham Region can help the families of more than a thousand auto workers who will soon be out of work following the elimination of the third shift at the General Motors plant in the motor city Friday.

The loss of the third shift will mean layoffs for at least 500 employees at the Oshawa plant – the union representing workers is citing a number closer to 700 – with hundreds more in the supply chain also affected.

Joe Cote, Chief Growth Officer at Merchant Growth, an online lending company specializing on small business, said the impacts from the layoffs will be almost immediate.

“When hundreds of paycheques disappear at once, that drop shows up quickly across the local economy, from independent retailers to restaurants and service businesses that rely on steady foot traffic,” noted Cote, who works with thousands of small business owners across Ontario. “In the Oshawa region, wholesale and retail trade and accommodation and food services employ tens of thousands of people, so a demand shock can ripple out beyond the plant floor.”

There are more than 90,000 people in Oshawa’s labour force, so the job losses make up a significant blow to the local economy. For every 100 jobs lost in durable manufacturing (like automotive), approximately 744 additional indirect jobs within communities are at risk, from local suppliers to eateries.

And when workers lose jobs and receive unemployment benefits that cover only a small portion of their wages, they stop consuming in the local economy, affecting restaurants, retail, and services, Cote said.

“Losing a job is a financial shock. It puts immediate pressure on rent or mortgage payments, groceries, and debt, and it forces households to pull back on discretionary spending fast,” he added. “One practical way residents can help right now is to keep more of their everyday spending local, because that demand helps stabilize small businesses and supports the local jobs that depend on them.”

Talk of eliminating the third shift has been news since U.S. Presidents launched a trade war with Canada in the spring with 25 per cent tariffs on the auto sector, with the original drop-dead deadline to eliminate the overnight shift at the Oshawa truck plant .

That deadline was then extended to January 29, with that reprieve ending today, with GM Canada confirming the loss of the third shift while promising to support the affected employees with separation packages and other benefits.

Unionized General Motors workers and their leaders packed their union hall this week to make sure their anger was on record and have vowed to continue to fight for the return of those jobs.

“We produce high quality trucks that generate billions in profits for General Motors. And how does GM repay that loyalty? With disrespect,” said Local 222 Plant Chair Chris Waugh. “GM loves to talk about family first, but the truth is simple: GM only cares about profit and the members know it.”

Eliminating the overnight shift at the plant also means a production reduction of about 48,000 Chevrolet Silverado trucks a year; corresponding to the same volume of truck production moved the company’s plant in Fort Wayne, Indiana.

Oshawa Assembly produces both heavy- and light-duty Chevrolet Silverado pickups – GM’s most important market segment in North America – and Oshawa is also home to GM’s advanced research facilities, including the McLaughlin Advanced Technology Track at Oshawa’s Canadian Technical Centre.