A dramatic plan to cut wage costs that is being piloted at Vauxhall’s Ellesmere Port factory could be rolled out across General Motors’ European operations as the carmaker desperately tries to slash spending.

The move is also expected to sweep across other manufacturing industries as companies try to hold on to staff but reduce the cost of paying them. Vauxhall’s Merseyside plant is offering the 4,500 employees a sabbatical of up to nine months on 30 per cent of their pay.

If there is a favourable response to the scheme it will be offered at Vauxhall’s sister GM factories in Europe. But a spokesman admitted that the business was not expecting a huge take-up from workers with heavy financial responsibilities.

The move is the latest and most radical move by a manufacturer to reduce payroll costs without cutting jobs. Companies are keen to retain staff for the long term in the hope that this will put them in a better position to take advantage of an economic recovery.

This week Corus, the Anglo-Dutch steelmaker, suggested its 25,000 staff take a 10 per cent pay cut in order to try to save jobs. The offer has been rejected by unions but talks are continuing. Unions may be wary of promises made on the back of pay cuts. A reduction was accepted by workers at JCB, the digger manufacturer, last month to try to save several hundred jobs, but then positions were subsequently cut.

Vauxhall’s move was announced to workers on Thursday but already other manufacturers are believed to have said that they are thinking of similar action. Companies are concerned to avoid losing skilled staff if they do not absolutely need to because of the skills shortage that they say is a big problem in the economy.

Car companies are taking extended Christmas shutdowns and planned production cuts in the new year to try to cut output so that it is in line with falling demand. They have so far managed that in terms of workers’ pay through the practice of “timebanking”.

The practice sees workers put in fewer hours in quiet times for the same pay, but then owe the company extra hours in busier times. It was designed largely to accommodate the production fluctuations associated with the introduction of new models and the phasing out of older ones. But in the current economic climate the practice is being tested to its limits and manufacturers are having to think of other ways to reduce workforce pay.

Manufacturers have also made a great deal of use of casual staff to build more flexibility into their workforce. However, in heavy industry most of these have now gone, leaving companies with only the core permanent workforce.

The big changes are putting the unions under a great deal of pressure. Pay cuts are usually anathema to unions but they are also desperate to protect permanent jobs.

Talks over Corus’s plans for next year will continue next week between management and unions. And although the pay cut is not welcomed by the unions it is expected to form part of those talks.

The EEF manufacturers’ organisation has given warning that there will be more moves by businesses to cut pay as reducing overall business costs becomes an ever more pressing need for industry.

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