The United Auto Workers strike isn’t happening in a vacuum. It’s part of a growing movement of US workers walking off the job.
From Hollywood writers to nurses, factory workers, and Starbucks baristas, thousands of workers have gone on strike in recent months to demand higher pay and improved benefits and working conditions. The Teamsters union recently used the threat of a strike by 340,000 members at UPS to secure most of their demands, including pay raises and new air conditioned vans.
Labor has become more aggressive because of decades of stagnant wages for lower and middle-income workers, while the richest Americans expanded their wealth to unprecedented levels. Corporate profits have soared since the pandemic, and workers want a greater piece of the profits.
“There’s a generational change taking place in the labor movement and its thinking,” said Joseph McCartin, a labor historian at Georgetown University.
Between 1979 and 2022, the inflation-adjusted annual wages of the top 1% of workers rose by 145%, while the average annual wages of the bottom 90% rose by only 16% — about a tenth as fast, according to the Economic Policy Institute. Several factors contributed to these trends, including deregulation, the decline of unions, and little change in the federal minimum wage.
The auto workers, for example, are taking aim at CEO compensation at Ford, General Motors and Stellantis — which has grown by more than 40% over the last four years — to press their case for worker wage increases.
Workers also believe they have more bargaining power due to a tight labor market and the strongest public support for unions in decades.
“We’re living through a strong labor market and economy, and workers and unions feel more leverage when economic forces are blowing in the direction they have been,” McCartin said.
Here's what the autoworkers' strike could mean for the rest of the US economy
From CNN's Elisabeth Buchwald
With the United Auto Workers’ historic strike officially underway, experts say the US economy is already getting bruised – but the strike’s impact isn’t likely to push the nation into a recession.
“That’s because the unionized part of the industry, while still large, is not as big a piece of the national economy as it once was,” Gabriel Ehrlich, an economic forecaster at the University of Michigan, told CNN.
But the ultimate impact of the strike depends on things like how long the strike lasts, if companies lay off workers at other plants, how many workers walk off their jobs and how long the unions and companies take to negotiate a deal.
UAW president Shawn Fain said “we’re not going to wreck the economy. The truth is we are going to wreck the billionaire economy.”
And while estimates of the economic impact of the strike don’t point at “wrecking the economy,” the damage could be significant.
For instance, if all UAW workers at Ford, General Motors and Stellantis strike for 10 days, it would cost the US economy $5 billion, according to Anderson Economic Group’s estimates.
Another estimate by Ehrlich assumes there would be a much smaller immediate spillover effect. He estimated $440 million worth of income would be lost nationally if all the UAW members strike for two weeks. If the strike lasts eight weeks, he estimates a $9.1 billion hit to incomes nationwide.
Here are some other key factors to consider:
Businesses near strike sites will see revenue slow: Although striking UAW members will be receiving $500 a week in strike pay, it likely won’t be sufficient for them to keep up their normal spending. That means local businesses near strike sites will lose out on revenue.
Suppliers that work with the Big Three could lay off workers: The Big Three automakers are going to be anxious to restart production as soon as the strike ends, said Ehrlich. That’s why he expects them to delay canceling orders with suppliers for necessary parts for as long as possible. But when the automakers ultimately do begin canceling orders, it could have a ripple effect throughout the parts supplier network.
Tax revenue will decline: Fewer people working because of the strikes will mean the government can’t collect as much tax revenue. That matters because it means that fewer programs will receive the funds they need.
The United Auto Workers' strike against General Motors, Ford and Stellantis has entered its third day. It's the first time that members have struck all three unionized US automakers at the same time.
The union has made ambitious demands in wages, benefits and job protections. With all three automakers reporting record or near-record profits, the union is trying to recapture benefits workers gave up more than a decade ago when the companies were on the brink of bankruptcy.
UAW President Shawn Fain signaled late Friday that the two sides were far apart entering the weekend, saying 80% of union demands have been left off proposals from the automakers.
The United Auto Workers strike isn’t happening in a vacuum. It’s part of a growing movement of US workers walking off the job.
From Hollywood writers to nurses, factory workers, and Starbucks baristas, thousands of workers have gone on strike in recent months to demand higher pay and improved benefits and working conditions. The Teamsters union recently used the threat of a strike by 340,000 members at UPS to secure most of their demands, including pay raises and new air conditioned vans.
Labor has become more aggressive because of decades of stagnant wages for lower and middle-income workers, while the richest Americans expanded their wealth to unprecedented levels. Corporate profits have soared since the pandemic, and workers want a greater piece of the profits.
“There’s a generational change taking place in the labor movement and its thinking,” said Joseph McCartin, a labor historian at Georgetown University.
Between 1979 and 2022, the inflation-adjusted annual wages of the top 1% of workers rose by 145%, while the average annual wages of the bottom 90% rose by only 16% — about a tenth as fast, according to the Economic Policy Institute. Several factors contributed to these trends, including deregulation, the decline of unions, and little change in the federal minimum wage.
The auto workers, for example, are taking aim at CEO compensation at Ford, General Motors and Stellantis — which has grown by more than 40% over the last four years — to press their case for worker wage increases.
Workers also believe they have more bargaining power due to a tight labor market and the strongest public support for unions in decades.
“We’re living through a strong labor market and economy, and workers and unions feel more leverage when economic forces are blowing in the direction they have been,” McCartin said.
With the United Auto Workers’ historic strike officially underway, experts say the US economy is already getting bruised – but the strike’s impact isn’t likely to push the nation into a recession.
“That’s because the unionized part of the industry, while still large, is not as big a piece of the national economy as it once was,” Gabriel Ehrlich, an economic forecaster at the University of Michigan, told CNN.
But the ultimate impact of the strike depends on things like how long the strike lasts, if companies lay off workers at other plants, how many workers walk off their jobs and how long the unions and companies take to negotiate a deal.
UAW president Shawn Fain said “we’re not going to wreck the economy. The truth is we are going to wreck the billionaire economy.”
And while estimates of the economic impact of the strike don’t point at “wrecking the economy,” the damage could be significant.
For instance, if all UAW workers at Ford, General Motors and Stellantis strike for 10 days, it would cost the US economy $5 billion, according to Anderson Economic Group’s estimates.
Another estimate by Ehrlich assumes there would be a much smaller immediate spillover effect. He estimated $440 million worth of income would be lost nationally if all the UAW members strike for two weeks. If the strike lasts eight weeks, he estimates a $9.1 billion hit to incomes nationwide.
Here are some other key factors to consider:
Businesses near strike sites will see revenue slow: Although striking UAW members will be receiving $500 a week in strike pay, it likely won’t be sufficient for them to keep up their normal spending. That means local businesses near strike sites will lose out on revenue.
Suppliers that work with the Big Three could lay off workers: The Big Three automakers are going to be anxious to restart production as soon as the strike ends, said Ehrlich. That’s why he expects them to delay canceling orders with suppliers for necessary parts for as long as possible. But when the automakers ultimately do begin canceling orders, it could have a ripple effect throughout the parts supplier network.
Tax revenue will decline: Fewer people working because of the strikes will mean the government can’t collect as much tax revenue. That matters because it means that fewer programs will receive the funds they need.
