No one wins in a strike.
That’s the conclusion of the Center for Automotive Research (CAR) in Ann Arbor after it analyzed the UAW’s nationwide strike against GM and the four-year contract that resulted.
Union members got higher wages and kept their health care coverage and cost structure along with other wins. But they did not get much in the way of added job security, said Kristin Dziczek, vice president of Industry, Labor & Economics at CAR.
“The UAW went into this looking for guarantees and certainly they didn’t lose anything,” said Dziczek in a webinar this month. “But after six weeks on the picket line, they came out of it with what they had,” in terms of job security.
Meanwhile, the Detroit carmakers will each see their average hourly labor costs grow at a rate higher than their nonunion foreign competitors who run U.S. plants, said Dziczek.
The UAW chose to negotiate first with GM and used that contract as a template for the agreements it hammered out with Ford Motor Co. and Fiat Chrysler Automobiles. The UAW’s 48,000 workers at GM’s 55 facilities in 10 states went on strike for 40 days before ratifying a new four-year contract on Oct. 26. The UAW struck similar deals with Ford and FCA shortly thereafter.
The new contracts gave GM’s workers generous ratification bonuses, wage increases, improved profit-sharing and lump-sum payments. But at GM there was no reversal to product allocation such as bringing a vehicle built in Mexico to a plant in the United States. “The economics has always been important, but the job security has become very important,” said Art Schwartz, the retired general director of GM’s labor relations. “The UAW got some decent [plant investments] so we’ll see how it plays out.”
Going into negotiations GM wanted to trim a $13 cost gap in its average hourly labor costs compared with its nonunion foreign competitors. Instead, GM will see labor costs rise from $63 an hour now to $71 in 2023, compared with a hike from $55 to $66 for nonunion foreign automakers in the U.S.
Ultimately, the strike was not worth it for the UAW workers, some experts believe.
“As long as this strike lasted, I would have thought there’d be something radically different in this agreement and it came out pretty much as expected,” said Marty Malloy, a retired Ford labor affairs vice president for 34 years. “There was really no language that was new or a breakthrough.”