Commentators across the nation are calling the new Boeing contract a “turning point” in the status of the middle class – but not the good kind. The deal squeaked by in a close vote by Boeing machinists (approved 51-49) to lock in a major aircraft construction contract for the Seattle area; yet it also pushed employers off of traditional pensions.
National union leaders, governor Jay Inslee and Boeing management itself all cheered with approval at the outcome of Friday’s vote — which went against the urging of local union leadership — calling the approval a needed boost to the region’s economy in the decade to come.
Of course the narrow passage shows deep divisions within the once-powerful union, but many feel that external pressure was the deciding factor, with several states promising to give Boeing exactly what it demanded for a contract to build the 777X. This put the aerospace giant at a huge advantage.
Leon Grunberg, a sociology professor at the University of Puget Sound an author of “Turbulence: Boeing and the State of American Workers and Managers” says that the incident shows that “even a strong local is vulnerable and has a limited defensibility to slow the tide of concessions that has been going on across the country.” He also pointed out that “This is happening with a company that’s doing very well financially.”
Members of the International Association of Machinists and Aerospace Workers approved contract extension covering the next 8 years, which was an about-face from November when those same workers rejected the a previous version of the offer by 67%.
Wilson Ferguson, president of a local unit of District 751, claims that the vote reduces the local union’s power by surrendering on benefits they won’t be getting back. He and many others opposed the new measures to freeze machinists’ pensions and push workers to a 401K savings plan.
“The very fact that Boeing was making these demands in the first place just has to be seen as discouraging for average workers,” said Jake Rosenfeld, a University of Washington sociologist and author of the book “What Unions No Longer Do.” “This is a very strong union, and if you have a strong union, being forced into givebacks of this sort … then you can just imagine how little leverage other workers have when negotiating,” he added.
Yet Richard Gritta, professor of finance at University of Portland, argues that Boeing had to extract these concessions from workers to stay competitive in the “dog-eat-dog industry” – one where Boeing and Airbus have traded dominance. “It’s a very tough industry. To gain these concessions from labor is critical,” he said following the vote.
Local union bosses had urged the 30,000 members to reject the deal, pointing out that the proposal ceded too much for workers at a time of unprecedented company profitability. Yet their position was overruled by national leaders in the Machinists union. Pressure to accept the deal came from other sectors as well. Several prominent political leaders, including Governor Jay Inslee, applauded the vote, saying that it will retain thousands of good jobs in the state and secure Boeing’s presence in the Seattle area, which has been its home-base now for almost century. Inslee argued that the outcome of the vote secured Washington state’s “future as the aerospace capital of the world.”
Workers were clearly anxious about the prospect of Boeing relocating this huge new production out of state, putting additional pressure on the machinists to approve the contract. At Boeing’s invitation, more than 20 other states recently put in bids to manufacture the 777X, a newer iteration of Boeing’s best-selling 777. Boeing claims that the 777X will be able to carry as many as 400 passengers while offering greater fuel efficiency than the 777.
Lynne Dodson, a member of the Washington State Labor Council — the largest labor group in the state with nearly half a million members – doesn’t see Friday’s vote as a sign of declining union influence, but rather of corporate stinginess. “It’s an indication of just how far Boeing will go,” she said. “It’s more a reflection of corporate greed than of union power.”
Meanwhile, Ferguson, the local union leader, summarized last week’s vote by calling it “a turning point in the labor movement. Pensions were hard-fought battles to get in the first place. Once they’re gone, they’re gone.”
“Their fear and intimidation worked,” he added.
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