By December 5, 2008 2 Comments Read More →

The Death of the Jobs Bank

UAW suspends jobs bank, delays retiree fund payments – USATODAY.com

So this might be the end of the infamous Jobs Bank that we’ve talked about here a lot. When I started working at GM in the mid 90’s as an engineer, the young Mark sure had a hard time understanding why the company had to pay people to read the newspaper, smoke cigarettes, and play cards in the cafeteria (if they even had to come to work at all).

The Jobs Bank, in a way, might have sounded “like Lean.” In Lean implementations (including mine in hospitals), many (but not all) consultants or coaches will emphasize that you can’t let productivity improvements from Lean lead to layoffs, and good reason. True Lean is about getting employees involved in making their workplace better — better quality and outcomes for customers and reduced waste. Why would employees participate in Lean if they’re going to lose jobs?

A better alternative to layoffs in a hospital is to use productivity improvement for growth — adding laboratory work that was previously sent out to vendor, which often means faster results and lower cost than before. Freed up space, cash, and people can be reinvested in the organization. Or, you can redeploy freed up staff to other areas, use them to make improvements in their original or other departments. Or, allow attrition to help reduce staffing levels more gradually.

At one hospital I work with, one of my former Lean Team members pulled me aside and told me that the organization (non-healthcare) that her mother works for had a “Lean” (LAME?) initiative that was basically all about layoffs. Her mom asked “what’s this kaizen stuff?’ and “how many people did you lay off at the hospital.” The answer was none, at the hospital.

OK, so back to GM. The Jobs Bank was put in place to protect workers who were made redundant not by Lean, but by robots (at least that was the case for most of them). But GM wasn’t really doing anything productive with most of the Jobs Bankers, at least at my plant. There’s the real waste and the lost opportunity. I guess we could call this the “waste of talent” in a Toyota Way sense.

I did get to use some Jobs Bankers for a few weeks during one of my improvement projects at the plant. Most of them were thankful to have something real to do and were pretty enthusiastic. I wonder how things might have worked out differently if there had been more of that over the past 12 years.

In this Newsweek article, a industrial relations professor makes a curious comment:

“In effect, Toyota doesn’t have a jobs bank because the company culture is one giant jobs bank,” Shaiken said. “I’m sure there’s a lot of people they could lay off tomorrow — given how poor the sales are — that they are training or retooling or doing something that is the absolute equivalent of the jobs bank.”

I guess he means that in a different way. When I think “the company is one giant Jobs Bank,” I think of sitting around doing nothing. Maybe the professor means that Toyota really lives out what the Jobs Bank could have been? It’s not quite the “absolute equivalent”, at least in how it was actually implemented with the UAW.

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Mark Graban's passion is creating a better, safer, more cost effective healthcare system for patients and better workplaces for all. Mark is a consultant, author, and speaker in the "Lean healthcare" methodology. He is author of the Shingo Award-winning books Lean Hospitals and Healthcare Kaizen, as well as The Executive Guide to Healthcare Kaizen. His most recent project is an eBook titled Practicing Lean that benefits the Louise H. Batz Patient Safety Foundation, where Mark is a board member. Mark is also the VP of Improvement & Innovation Services for the technology company KaiNexus.

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2 Comments on "The Death of the Jobs Bank"

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  1. Anonymous says:

    Newsweek says there are 3500 jobs bankers at GM. 3500 * $80k a year = $280 million.

    That alone isn’t bankrupting them… but cutting the program will save more than not replacing the batteries in the clocks, as the WSJ wrote about before Thanksgiving. I was surprised you didn’t blog about that.

  2. Mark Graban says:

    GM and Chrysler are ending their jobs bank programs:

    GM:
    LINK

    Chrysler:
    LINK 2

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