Union Bump: Why Writers, Railroaders and Baristas Are Sticking It to Corporate America
What do actors, drivers and factory workers have in common? The bravery to stick it to their bosses — and enough leverage to make Wall Street break a sweat.
It’s been a monumental few years. Union memberships are growing at decade-highs, and by the middle of 2023, more than 58K workers had joined a union — the second-highest since the turn of the century. This year, 453K workers have gone on strike, demanding better wages and working conditions, and America’s approval of labor unions sat at a 50-year high.
This year’s lucky ones: United Auto Workers (UAW) achieved a record 25% pay increase; Teamsters managed to squeeze out $170K in pay and benefits for UPS drivers; and writers and actors have stuck it to Hollywood bigwigs for what is expected to be the union’s biggest pay increase in history. Villanova University’s Professor and Sociology Program Director Rick Eckstein told NBC, “They had been giving up benefits and wages for 30 to 40 years almost across the board.”
- Americans have seen stagnant wage growth over the last six decades — with hourly pay rising just 17.3% from 1979 to 2020.
- In contrast, CEOs made 344x what a typical worker was paid in 2022, up from 21x in 1965.
Wall Street is getting nervous
…And unions aren’t only impacting the corporations being targeted by strikes. Shipping companies have reported lower shipments from the auto walk-outs, while the Hollywood strikes had a major impact on LA’s travel, restaurant and local businesses. Strikes have also increased the stakes for investors and companies, who are worried that unions could eat into profits or, worse, bring businesses to a complete halt.
- During the UAW’s six-week strike, US automakers lost over $2.9B and industry leaders Ford and GM declined to provide guidance given the financial uncertainty.
- At least 280 S&P 500 companies have mentioned strikes or unions on their earnings calls this year — a three-fold increase from 2021.
Taking precaution: The Economic Policy Institute reported that nearly 200K employees joined unions in 2022, but companies hired nonunion jobs at a faster rate by offering attractive wages, improved scheduling and better benefits. Companies like Amazon (NASDAQ:AMZN) and Starbucks (NASDAQ:SBUX) say this has helped them prevent the march of labor unions.