A lesson from Oshawa: Plan for the unexpected

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Sometimes business practices hurt.

Just ask the people who work for General Motors in Oshawa. Due to GM’s global restructuring, by the end of this year the Oshawa plant will close, leaving 2,500 employees out of work. And, in a ripple effect, an additional 15,000 jobs will be affected in the auto supply industry.

 Some may find jobs elsewhere, but it is uncertain if they will be able to match their union wages.

Unfortunately for workers around the globe, plant closures and massive job loss is normal.

The musical The Last Ship,currently playing in Toronto, is a story of labour strife. It was created by rock star Sting who was growing up in the northern England town when it lost its ship building facility. On Valentine’s Day, Sting and the cast of his Tony nominated musical performed a free concert in Oshawa in solidarity and support of the GM workers.

In today’s modern world everything is mobile. Investment capital transitions freely between companies, industries, and countries. And so do jobs.

Oshawa is a perfect example. The community has been building cars for 100 years and at one time it was one of the largest auto assembly plants in the world. Employment was as high as 23,000.

One thing we can learn from the hardship felt by workers in Oshawa: have an emergency plan in place.

Everyone should have an emergency or rainy day fund to help with unexpected situations. However, according to a recent RBC poll, nearly half of Canadians admit they are better prepared for weather events than a financial emergency.

Do you have excess cash or a line of credit? Have you reduced your personal debt so there is room to increase your borrowings when an emergency happens?

Do you own investments that can be easily sold? Remember if funds are withdrawn form a RRSP those funds are added to your income and taxed.

In no way does this mean you should be paranoid. However, it is in your best interest to have a contingency plan in case something like a job loss happens to you.