UAW Union President Calls for Strike as Deadline Approaches
With less than two hours remaining until the deadline for the United Auto Workers (UAW) and the Big 3 U.S. automakers to reach a tentative agreement, Union President Shawn Fain has called for three units of the union to be prepared to strike at midnight.
In an update to union members, Fain stated, “Tonight we call on three units to stand up and go on strike at midnight if we do not reach a tentative agreement in the next two hours.” This strike would mark the first time in the union’s history that they would simultaneously strike all three of the Big 3 automakers – General Motors, Ford, and Stellantis.
The Ford Motor Company responded to the UAW’s counterproposal, expressing disappointment in the lack of movement from the union’s initial demands submitted in August. The company stated, “The union made clear that unless we agreed to its unsustainable terms, it plans a work stoppage at 11:59 p.m. eastern.”
The potential strike poses a significant threat to the livelihoods of up to 143,000 workers and the financial stability of the top automakers in the nation. The economic fallout could extend beyond the immediate players involved, impacting businesses that rely on spending from striking autoworkers, car component suppliers, and consumer behavior.
Economists warn that a six-week strike could cost the U.S. economy two-tenths of a percentage point of growth over three months, affecting various sectors already facing challenges due to high oil prices, a potential government shutdown, and the end of the student loan payment moratorium.
The direct impact on autoworkers, as well as the resulting economic activity losses, would have immediate repercussions. Employees participating in the strike would receive strike pay of $500 per week, significantly less than their usual income. This reduced spending power would affect businesses such as restaurants and movie theaters, leading to additional revenue losses.
The economic impact would also be felt by companies down the supply chain, as lost production would result in furloughs and diminished income for workers. The longer the strike lasts, the more severe the consequences become, potentially leading to job losses and higher car prices.
Michigan, being a hub for the automotive industry, would face the most significant impact. A four-week strike against all three automakers could result in 161,000 lost jobs in the state, according to a report. A long-term strike could cause over 300,000 job losses in Michigan alone.
As the clock ticks down, President Joe Biden has personally intervened and spoken with UAW President Shawn Fain and leaders of the major auto companies to stay updated on the negotiations. The White House confirmed Biden’s involvement as both sides continue to work towards a resolution.
The outcome of the negotiations and potential strike will have significant implications not only for the UAW and the automakers but also for the broader economy and the countless individuals and businesses impacted by this critical labor dispute. The automotive industry, already grappling with various challenges, is on the precipice of a potentially devastating situation that could ripple throughout the nation.