GM employment is dropping faster than its stock price

In the broader scheme of things, during the current recession, the raw numbers might not be all that significant anymore, but it’s hard to escape the implications when General Motors announces plans to trim yet another 10,000 jobs.

Today’s news will bring to just 73,000 the total white-collar workforce struggling to keep the automaker going, a fraction of the total just five years ago. The automaker, in a release, said the cuts are a critical component in the corporate restructuring plan required to win another tranche of federal loans.

GM must submit an interim viability plan to Washington on February 17th, with a broader turnaround plan due by March 31st. If the plans are approved, the company could receive the additional $4 billion it has been seeking.

There’s no question that the automaker has traditional been bloated and inefficient, according to Dan Gorrell, an independent analyst from Los Angeles. But when does the cutting reaches the point of no return, observers fret. Already, GM is struggling to man its various product development programs, marketing and other operations.

The new cuts will be felt at GM operations around the world, with at least 3,400 jobs to be lost in the U.S. It appears the automaker will not turn to the costly buy-out programs that it has used in the past to encourage workers to leave voluntarily.

Along with the job cuts, GM will now trim salaries for most white-collar workers, through at least the end of 2009. For most, the cuts will range from 3 to 7 percent, while executive salaries will be slashed by 10 percent.

As part of its effort to reign in costs, GM has already announced plans to drop or scale back operations at several brands, including Hummer, Saab and Pontiac, while the future of the Saturn division is under study. While a number of plants have already been closed, company insiders hint that additional assembly lines could be shuttered as part of the viability plans now under development.

The government is demanding that all stakeholders participate in GM’s turnaround efforts, and that means thousands of dealers could be closed, while the United Auto Workers Union will be granting new givebacks. Meanwhile, bondholders are negotiating concessions that could see them trade debt for equity.