US rail strike plans threaten further business disruptions
Fast 115,000 people could leave the jobs, halting freight and passenger train traffic
After negotiations between railroad unions and transport companies failed, nearly 115,000 US railway workers will strike at midnight on Thursday. This would shut down 40% long-distance commerce. Although the closure of long-distance trade is over, the “cooling off” period does not guarantee a strike, two of the 12 rail workers’ unions have yet to reach a deal with the industry’s bargaining committee, and the other 10 have vowed to walk off the job if even one union is left without a contract.
According to the Association of American Railroads, a strike could cost the US economy up to $2 billion per hour. US Chamber of Commerce warns of strike “national economic disaster,”Industry figures have warned that a strike could double the economic impact each day, even though they are warning. Supply chain disruptions caused by the Covid-19 shut downs, record-high inflation and high energy prices have already put a strain on America’s economy.
According to reports, President Joe Biden has been working with “other modes of transportation” to try to pick up the slack, but the trucking industry was already short 80,000 drivers before the strike, and the AAR’s analysis found an additional 467,000 long-haul trucks would be required to move the stalled freight.
A Presidential Emergency Board appointed in July has recommended a 14% wage increase for workers and stronger benefits, but the unions say they won’t accept any proposal that doesn’t change the “brutal”Current attendance policies force them to attend “on call”90% of all the time.
“If this contract is presented to our members in its current form, it will not pass,”CNBC was informed Monday by a spokesperson for the union.
Workers are furious. Workers are angry about the absence policies. They also want to be able to take vacation days or sick days without fear.
Railroads claim the system is essential to provide sufficient labor force to run their operations and have claimed to be hiring aggressively in order to lessen the strain. However, the US Surface Transportation Board revealed that major carriers had reduced their workforce by 29% during the last six years.
Transporters are already planning for strike and securing dangerous materials or sensitive cargo. In preparation for the strike, Amtrak, a passenger operator has cancelled all long-distance flights beginning Thursday. Although its employees do not belong to the strikers, 97% operate on the freight lines of striking unions.
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The northeast corridor, Washington, DC to Boston, via New York City, is not affected by this change.
In 1992, rail workers went on strike. It lasted for two days, before Congress interceded. A possibility that the Biden administration hopes to avoid in a year of midterm elections in which his party is dependent on union support.