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The United Automobile, Aerospace and Agricultural Implement Workers of America, an American labor union with 391,000 members, has begun threatening a strike once their contract ends on September 14th, unless their demands for better compensation and working conditions are met. Among these demands are a 46% pay raise and a 32-hour work week with 40 hours pay.
These demands have primarily been levied against companies in the automotive sector, specifically the Big 3 car companies – General Motors, Stellantis, and Ford, all of which are based in Detroit where the heart of the Strike movement lies. In a speech on Labour Day, UAW president Shawn Fain claimed that they would take action by “any means necessary” in order to achieve their goals for better conditions.
The Detroit 3 have reached $164 Billion USD in net income over the past ten years, with $20B this year alone. Ford CEO Jim Farley, who took the position in 2020, makes a net income of $21 Million annually, with the CEOs of GM and Stellantis making $28.9M and $15.7M USD annually. Fain argues that there remains a double standard for CEOs and executives at these companies in comparison to a typical worker: At his labor day speech, he claimed: ““They get out-of-control salaries… They get pensions they don’t even need. They get top-rate health care. They work whatever schedule they want. The majority of our members do not get a pension nowadays. It’s crazy. We get substandard health care. We don’t get to work remotely.”
The full details of the UAW strike remain rather ambiguous; there has been no information as to whether the union would strike one of the Big 3 companies, or if employees at all 3 would go on strike – the latter would deplete all union funds within 3 months.
That loss in funds, however, pales in comparison to the economic damage even a short strike would wreak upon the Big 3 companies – it is estimated even a 10 day strike would cause almost a billion dollars in losses for the companies. Despite this, all companies thus far have refused to cede to the strikes demands; Ford has neglected nearly all of them, an act Fain deems “insults to the very worth” of automotive workers.
Big 3 companies cite this lack of flexibility and budgeting as a necessity to remain competitive in an automotive sphere that is facing increasing takeover from Tesla and foreign manufacturers, companies fear that increasing the benefits given to laborers and their wages will cause further vehicle price increase due to dwindling supply in a market that is already unforgivably competitive.
In a statement this past labor day, President Biden claimed he’s “not worried about a String… [he doesn’t] think it’s going to happen”
Though an eventual settlement between the two groups is more likely than a full fledged strike, I think that this current conflict is indicative of a new, burgeoning labor movement within the United States that has not been seen since the mid 1900s. American workers are becoming increasingly class-conscious, and attempts at unionization and the formation of co-ops is increasingly common. While they are unlikely to occur at this scale often, small-scale strikes and unionizations, like the unionization of Starbucks franchises in Portland and almost 300 other locations, are something I think we will see more and more as more American workers are made aware of the bargaining power they can hold over corporations if they organize effectively.
5 comments:
I thought your point about the growing bargaining power of workers was very interesting! Another large contributing factor could also be the labor market (which has been doing pretty well), which, aside from unions' abilities to organize effectively (arguably also very important) definitely has a big role in giving workers more bargaining power.
Additionally, I wanted to ask what caused you to come to the conclusion that this would be the largest labor movement since the mid-1900s? If I recall correctly, there were pretty massive movements in the 1980s and 1990s (railway workers, air traffic controllers, etc) that, so far this year, still surpass 2023's numbers in terms of workers involved in strikes by a good margin. Nevertheless, I definitely agree that there seems to be a trend towards unionization.
Lastly, I thought there was an interesting connection to be made to the Hollywood strikes and the actors/writers' disputes over AI. I'm not sure how big of a contributing factor the shift to electric vehicles has been (since they require fewer workers to manufacture), but it seems like evolving technology is definitely affecting workers across various industries.
Something I found very intriguing about this potential strike is the fact that a similar strike happened at GM back in 2019, in which 48,000 workers went on strike looking for better compensation. I'd say the projected losses for the companies you provided seem pretty solid, seeing as the 2019 strike, which lasted 6 weeks (the longest for auto workers for last half century), ended up costing GM an estimated 1.75 billion dollars, not including settlement payments, according to the Anderson Economic Group. Factoring in inflation since 2019 and the fact that this new strike will include 2 other major automobile companies, it's definitely possible that the 1 billion dollar mark could be surpassed in 10 days. Somewhat worrying, however, is how little change this 2019 strike caused, as the resulting wage increase was a mere 3% in alternating years. Hopefully the workers' leverage you mention is enough to get the full desired 46%, but I do have some severe doubts.
I thought this article was very interesting, and how you brought up that strikes are something you predict seeing a lot more of, considering how people are becoming more aware of what the people above them at work are getting. A connection I made while reading this was how the UC Teacher Assistants and tutors went on strike as they felt they were not getting paid enough for the work they put in that those above them, such as professors, were falling short of. I think that the interesting thing about strikes is when those who may appear like they do less than the boss or ceo stop working, and finally peoples eyes are opened to the impact they have. This is especially apparent when you mentioned that even a 10 day strike would cause a billion dollars for the automobile companies, which I hope will help them negotiate with the workers. Although I doubt they will be able to get a 46% raise, I hope they get something close to it, and maybe like you said this will encourage more strikes in other places.
I think strikes like these are proving that the American more laissez-faire type of governing towards the economy is having a negative effect on workers' rights. I believe we do need some more regulation on massive corporations such as Ford where the few with the highest paychecks could not run the business without these numerous workers on strike as proven by the billions of dollars they would lose from a 10 day strike. I don't believe these regulations will come any time soon while these strikes are going on, however, since policies take a while to come to fruition as we have discussed in class. The textbook reading mentions a progression in technology leading to an informal change in the Constitution which I believe the writers' strike around AI that Rachel mentioned could be an example of. Hopefully these strikes and increase awareness around workers' rights will spark a change in policy.
Considering the current writer's and actor's strike, it does appear that workers in the US are becoming more and more conscious of their current situation, and most importantly, deciding to take action about it. I feel like COVID was a bit of a wakeup call for many workers where they realized their poor treatment by so many companies, which is spurring the wave of strikes right now. I feel like this new labor movement is going to have a bigger influence as time goes on and more and more workers start unionizing and striking for better treatment. Like Agastya said, we may be heading for a repeat of the mid 1900s, only who knows how this will end up going this time around? Well, only time will tell I suppose.
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