By KALEA HALL
General Motors’ profit-sharing payments and performance bonuses to local employees will do more than just benefit the workers and their families.
The $9,000 payment the majority of Lords-town workers will receive will benefit the local economy, analysts and local businesses said.
Nearly every conceivable business could reap the benefits of about 4,100 workers’ receiving $9,000.
Locally, the total potential payout of $37 million will go into the pockets of eligible workers and probably find its way into the local economy.
“It is a win-win for everyone,” said Robert Morales, president of United Auto Workers Local 1714.
George Beshara, owner of The Gold Exchange on Market Street, has some GM workers as customers.
“If they have anything left over, I will see them,” he said. “We do have a loyal customer base. Most of our customers we know by first name.”
B.Y. Pools and Spas on Struthers Road in Poland hopes the extra money will bring more customers there.
“Hopefully, [that means] a sale of an in-ground pool or an above-ground pool or hot tub,” said Lexa Shaffer, manager.
In the case of UAW Local 1112 President Glenn Johnson, the extra money will go toward his daughter’s wedding.
“Anytime we get an infusion of that amount of money, that will give extra to go toward improvements on the house [and other items],” Johnson said. “The restaurants will be better, the malls will be better.”
On Wednesday, GM announced it turned a $2.8 billion profit in 2014 and, with that, up to $9,000 for more than 48,000 workers. GM had to spend $2.8 billion in pretax costs to fix more than 42 million recalled vehicles worldwide, but the company still had positive sales last year.
“I think it is about the opportunity for GM to say, ‘Hey, we had a rough year, but we still did really great and we are going to share with the folks who are helping us achieve success in the marketplace,’” said Eric Lyman, vice president of industry insights for TrueCar.
The UAW already had negotiated a profit-share payout of $7,000, and then GM added on a $2,000 performance bonus to those eligible employees. Those eligible had to work 1,850 hours last year.
“Obviously, the impact on the local economy will be significant,” said Guy Coviello, vice president of government affairs and media for the Youngstown/Warren Regional Chamber. “What a testament that is to our workforce here, especially in light of our product being such a top seller.”
Lordstown workers build GM’s best-selling car, the Chevrolet Cruze. News of the $9,000 payout to employees came just after the Cruze broke January sales records. In 2014, the Cruze had its best year yet with more than 273,000 sales.
Mekael Teshome, PNC economist, said the $9,000 payouts are a positive for the Mahoning Valley, especially after the rough decade the region has seen.
The economy’s core drivers are healing, Teshome said. “We do expect continued recovery in the region.”