Autoworkers are the latest union members to fight for an eye-popping raise

Big union demands — bolstered by a tight labor market and frustration throughout the COVID pandemic — are paying off in some sectors with significant raises for workers.

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In this country, here’s something that may shape the news of this week. On Friday, 150,000 autoworkers could walk off the job, potentially bringing the operations of the big three U.S. automakers to a halt – Ford, General Motors and Stellantis, the parent company of Chrysler. Workers want a 46% wage hike over four years. A lot of unions have demanded big raises this year, and some are winning. NPR’s Danielle Kaye reports.

DANIELLE KAYE, BYLINE: What the United Auto Workers, or UAW, is pushing for might seem shocking, but not to Marcelina Pedraza, a Ford electrician in Chicago.

MARCELINA PEDRAZA: If they want to be competitive and have a good workforce, they’re going to have to pay to show that, you know, we deserve more.

KAYE: Workers like Pedraza say companies can afford to raise workers’ pay by a lot. The Detroit Three automakers made $21 billion in profit collectively in just the first half of this year at the same time that workers feel they’ve been struggling.

PEDRAZA: Everything’s going up – right? – like, the cost of food, gas, you know, mortgage interest rates. And it’s just – it’s not enough.

KAYE: The last time UAW signed a contract was in 2019. That deal came with significantly less – two annual wage hikes, 3% each. That range has been the norm for many years. But these days, much higher wage demands aren’t that unusual. So far in 2023, workers all over are fighting for them, and some unions have been able to get pay raises of almost 50% in their new contracts, like American Airlines pilots. Dennis Tajer is a 737 pilot and a spokesperson for the Allied Pilots Association. He says the four-year 46% pay raise comes after years of stagnant wages.

DENNIS TAJER: The bottom line is it’s been a long time since there’s been any financial gain.

KAYE: Another group of workers who’ve seen their paychecks go up recently – 340,000 UPS workers. They were on the brink of a strike. But then in July, the Teamsters Union secured a 48% average wage increase over the course of the five-year contract for existing part-time workers. Jennifer Hancock started out decades ago as a part-time package sorter at UPS in Richmond, Va., making $8 an hour. But she says workers need a lot more now to keep up with the cost of living.

JENNIFER HANCOCK: For a part-timer who is hired now, they would need to be making somewhere in the ballpark of $25 an hour to have the same buying power that I would have had back in 1991.

KAYE: Union contracts ratified in 2022 gave workers the highest average pay raise in more than three decades. That’s according to Bloomberg Law labor data. It’s a trend that’s holding up in 2023, and it’s a shift away from decades of management leverage over workers.

TOM KOCHAN: And so this is a pivotal year.

KAYE: Tom Kochan is a professor of work and employment at MIT.

KOCHAN: Now it’s time to catch up – catch up on losses due to inflation, catch up in terms of a better distribution of the profits of the company.

KAYE: There’s been a shortage of workers in many industries, and after putting their health at risk during the pandemic, a lot of front-line workers are feeling emboldened to ask for more. But autoworkers might not be able to repeat the success of the pilots and UPS workers. Flights and package deliveries would halt without those workers. Harry Katz of Cornell University says automakers have nonunion factories that operate in the South, and they can shift production overseas.

HARRY KATZ: The autoworkers have strong leverage but not exceptional leverage.

KAYE: The car companies so far have responded with offers of much smaller pay increases of 9- to 10%. UAW President Shawn Fain calls them, quote-unquote, “insulting.” He says workers are ready to go on strike, if necessary, after their contract expires on Thursday.

Danielle Kaye, NPR News.

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