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editorial

If there’s a saving grace in General Motors’ decision to “unallocate” its Oshawa assembly plant, bringing an end to more than a century of automaking in the city, it’s that the company acted as if it were making a business announcement, not issuing a ransom note.

The auto industry’s major players have long driven with one eye on the road and one hand out the window. Asking governments to pay for a new assembly facility, or to pay again to keep an existing one open, has always been part of the game. Over the years, GM has received more than its fair share of Canadian taxpayer assistance. Yet on Monday, the company gave no sense that it was soliciting bids to keep Oshawa open. Nor were the federal or Ontario governments acting as if they were about to start making offers.

Prime Minister Justin Trudeau on Monday morning tweeted that he had spoken to GM chief executive Mary Barra and had expressed his “deep disappointment at the closure.” He was already talking in the past tense. Innovation Minister Navdeep Bains said that, while the government was willing to discuss ways to keep the Oshawa assembly line going, GM had “been very clear about their position.”

And Premier Doug Ford said that when he spoke with the president of GM Canada on Sunday, he asked: “What can we do? What do we have to do?" The reply: “The ship has already left the dock.”

Both governments were instead talking about assisting the more than 2,500 workers likely to be laid off over the next year.

Those responses were depressing, but realistic. GM, which has more manufacturing capacity than sales and several factories consequently operating well below capacity, is significantly downsizing operations around the world. Four North American plants, including Oshawa, will be unallocated in 2019 – meaning they will have no work and no need for employees. Three plants outside North America will cease operations, including one closure already announced in South Korea. The company is aiming to reduce its global work force by 15 per cent.

GM is also trying to refocus its operations on what’s selling now – trucks and SUVs – and what it believes it will need to offer consumers in the future, namely electric and self-driving cars. The Oshawa facility does final assembly on trucks, but it mostly makes the Chevrolet Impala sedan. If you can’t recall the last time you saw one of those, you’re not alone. Sedans like the Impala used to be the kings of the North American road, but they’re now an increasingly rare breed.

No government ever wants to see a headline announcement about big layoffs on its watch. A hundred small downsizings go unnoticed, as do a hundred small startups. They blend into the unheard hum of the economy.

But a major layoff stands out and creates news – as does a ribbon-cutting for a big factory opening. It’s why the multinational giants of industries such as automotive and aerospace have traditionally been able to start bidding wars for their manufacturing facilities.

Keep in mind, however, that the Canadian economy added 206,000 new jobs over the past year. That’s the equivalent of opening one new Oshawa assembly plant every five days.

The Canadian labour market had 18.7-million jobs in October, the product of hundreds of thousands of jobs disappearing and being created each year.

It’s a reminder that when it comes to jobs, governments have to focus on the big picture, not the big headline. Offering a package of financial incentives to keep a manufacturing plant, like the GM plant in Oshawa, is often the first thing that comes to the minds of governments and voters. But it’s not often the best move. The per-job price is usually very high.

Better for government to focus taxpayer dollars on maintaining a strong social safety net to support anyone who gets laid off, because in a properly functioning free-market economy, sometimes companies do downsize or go under.

Better to make sure that safety net is robust enough so that losing a job doesn’t mean losing health care, or falling into poverty. Better to focus on funding extensive retraining options for those who lose jobs or have to change careers.

And best of all to focus taxpayer dollars on creating a superb Canadian labour force through excellent schools, universities, colleges and apprenticeships. That way, even when companies or plants shut down, there’s fertile ground in which others can quickly grow.