There is a decent episode on this on The Daily by the NYT. Gives some historical context of the give and take of the unions and big 3.
One takeaway, this particular new union leader is the first directly elected one in a very long time. Prior to this the union leader was selected in a good 'ole boys manner by union reps and sort of rotated. After the justice department found quite a bit of graft and bribery they required a new election and Shawn Fain won in a razor thin recount.
As a result the UAW for the first time in a long time got a populist representative of the average union worker, thus the hard line strike. So for those of you against unions because of corruption, etc. This is what it looks like when there is at least less of that, a good thing.
I honestly don't know how the Big 3 will be able to fiscally handle the UAWs demands all while tooling up for an EV future. They'll have to raise prices of existing profitable vehicles (trucks & crossovers) in order to pay for all this. Meanwhile Tesla will be miles ahead in terms of technology and room to lower prices while still turning a profit, and if any of their foreign competitors are able to successfully come up with an attractive EV crossover (admittedly a big if), then they could be in for some real trouble.
20 years ago, it made sense to prop up these manufacturers to support the domestic industry, but given the rise of the domestic EV industry (Tesla, Rivian etc), I'm not sure if it would still make sense for a strategic perspective.
Politically, it may still make sense, though.
Auto profits are falling. Whule I wish everyone higher pay, there must be enough pie for a bigger slice. This will likely, and sadly, get worse for both workers and automakers before it gets better, or offshored.
Pretty good gig: get unsustainable pay and pensions during good times. Funnel a bunch of it into politics. Get pensions guaranteed and bailed out in bad times. Been this way since the 60s
General Motors CEO Mary Barra, the highest-paid chief executive among the Big Three, made nearly $29 million in 2022. Securities and Exchange Commission filings show that this is 362 times the median GM employee's paycheck [1] (this pay ratio is required reporting from public companies now).
Profits at the “Big 3” auto companies—Ford, General Motors, and Stellantis— skyrocketed 92% from 2013 to 2022, totaling $250 billion. Forecasts for 2023 expect more than $32 billion in additional profits [2] [3].
Polling shows a majority strongly supporting the union's efforts in this regard [4].
The money is there, and the people who doing the work are asking for a greater share of the profits generated by their work. This is not unreasonable, and Labor should continue to turn the screws as politics shift, as well as structural demographics causing labor demand to exceed supply for at least the next decade.
Leaving CEO pay aside, that means the median salary I'd $80k. And we're talking Rust-Belt, not Silicon Valley. That's a pretty good salary for the region, plus the benefits they get.
Not seeing how the demands are in any way reasonable.
Without any snark, I suggest consuming more data. What you consider "pretty good" is the bar now [1]. Wages have been stagnant for decades. Combined with recent aggressive inflation, your idea of reasonable might simply be out of touch with the labor market. To note, there was surplus labor that made these demands untenable until COVID generated ~2-3M excess deaths over a short window of time, pulling forward reduced labor supply from structural demographic compression [2] [3]. Tangentially, 55+ who are clinging for life to labor participation are what is holding up the participation rate. Anything that causes those folks to exit the labor force more rapidly than retirement (3.6M Boomers retire per year) or death (~1.8M/year for 55+ cohort) is going to cause labor supply to dip deeper than the current forecasted curve [4].
> that means the median salary I'd $80k. That's a pretty good salary for the region.
That is exactly the kind of thinking that got us into this mess where companies post record profits year after year and employee pay does not increase.
These employees are generating billions of dollars of extra profit for the company, and they want a bigger share of that.
How much they are earning is utterly irrelevant, they want a bigger share of the enormous profits they are generating. That is the end of the story
Another way of looking at it: we're always positing on this site how much value we leave on the table as software developers and how we should try to capture more of that value, whether it be by consulting, or freelance work or a startup.
I think comparing the compensation for white collar labor and blue collar labor can be a bit apples-to-oranges sometimes when you consider the toll that physical labor takes on your body, which in turn limits how much time you can spend at your full earning potential. My friends in the trades have noted that the good pay when you're young comes as a sort of loan against how bad your knees and back will hurt by the time you're middle-aged. Versus someone like me who, barring a freak accident or sudden catastrophic illness, can expect to continue toiling in the software mines until I'm old and grey.
Cute phrase, though maybe you can spend some time working in the mines. Most all trades are hiring. It's enlightening how different life/culture/America is, particularly underground.
According to the article, they want 32 hour weeks while still being paid for 40, so you might make apples-2-apples by saying they want $100k when comparing to other professions that would be working 40hrs
Good, 40 hours is too much. They should be living their lives, not toiling away enriching others. Let the shareholders be a little bit less rich and let the workers have more time to be with their friends and families.
Nobody has to work 40 hours. Everyone can choose to work less, prioritize other stuff in their lives, and be paid less. I'm not sure how we could have our cake and eat it, too?
1. So this is a gambit in the contract negotiations, its unlikely to be taken seriously but can be given up at a later date. The first stage of these negotiations always has a ton of these whacky asks.
2. Since the concessions the union made in '00 (?) there has been a two tiered pay rate system. Essentially, 1/2 the wages for new hires (was like $28/hr for vets and $15 for newbies in '00). This has caused the big 3 to lean on newbie wages and sometimes do required work 6/7 days a week for >10 hrs a shift. So the new union boss is trying to make a point that equal pay needs to come back along with work/life balance even for factory workers.
3. I did some off the cuff math, GM+Ford+Stellantis did stock buybacks of AT LEAST 9 Billion to shareholders in '22. Estimates of the current kinda crazy opening bid at 40% raises + other incidentals is a cumulative 80Billion split between the big 3 from september of '23->september of '27 so 4 years or ~20Billion a year. A big number but remember the big 3 made something like 50 billion in profit, even subtracting that stock buyback first. So effectively the union is asking for 2/5ths of profits, or 1/3rd if you add in the stock buyback.
tldr; the money is there. The big 3 offerred a 10% raise, union wants 40%. My guess is they meet somewhere around 25%. Or about a year of profits over a 4 year contract. Big 3 would be stupid not to agree they are making money hand over fist and this still leaves them plenty of room to stay nimble. In addition they are losing billions a week with this strike.
Median is 50percentile. 50% of employees are making less than 80k.
You'd need a scatter plot of pay vs experience in this cohort to really say that the demands are unreasonable.
We dont know how much buearocracy/middle mgmt there is in these companies, and how much they make, and how much value they contribute, vs extract.
I dont see how any lay person can pass judgement about whether the strike is fair or not without access to a lot more facts than just ceo pay or median pay.
Not saying that the strike is justified, just that the over confident tone that its not is unwarranted.
The issue is that profits are highly cyclical, and the automakers are coming off some of their best years ever due to circumstances that are extremely unlikely to repeat. Locking those wages in is a great way to cause the next crisis.
You can't leave CEO pay aside, that's the whole point. These companies are making record profits and CEOs are taking home record pay. I think the workers who are actually building the product deserve pay in line with the profits they're helping the company achieve.
> Did you come from Reddit's Antiwork or something?
I provide financial and logistical support to worker organizing efforts, so being familiar with this information is top of mind. Not anti capitalism, just believe it needs to be toned down a bit. More humanity and a bit less chasing numbers in spreadsheets and databases.
Mary would be just fine earning mid 7 figures, for example. Saying she should make 0 is hyperbole, no one is arguing for that. Workers are arguing for a more fair deal.
>I provide financial and logistical support to worker organizing efforts, so being familiar with this information is top of mind.
It shows, given all the lies you've been spewing all over this thread.
For example:
>Profits at the “Big 3” auto companies—Ford, General Motors, and Stellantis— skyrocketed 92% from 2013 to 2022, totaling $250 billion. Forecasts for 2023 expect more than $32 billion in additional profits [2].
None of this is true.
The combined net income of those 3 companies during that time period is $168 Billion, not $250.
The total combined net income in 2022 was $24.6 Billion, only 34% above the $18 billion for 2013 (in reality this was a real profit stagnation given the cumulative inflation over that time period).
And your "Forecast" is literally a Pro-Union Mouth piece with no actual source for it.
The reality is that this industry isn't doing well, their returns on assets have consistently been below their cost of capital, and additional labor costs won't help with that.
Between 2013 and today the cumulatice rate of inflation was 33.33%, vs the 34% in profit increase => stagnation
As for the mouthpiece thing, here is a quote on the about page from the link he provided https://www.epi.org/about/ :
>The Economic Policy Institute (EPI) is a nonprofit, nonpartisan think tank created in 1986 to include the needs of low- and middle-income workers in economic policy discussions. EPI believes every working person deserves a good job with fair pay, affordable health care, and retirement security. To achieve this goal, EPI conducts research and analysis on the economic status of working America. EPI proposes public policies that protect and improve the economic conditions of low- and middle-income workers and assesses policies with respect to how they affect those workers.
This is literally an organization dedicated to increase workers compensation. ie: a pro-union mouthpiece.
> provide financial and logistical support to worker organizing efforts
When looking at American unions, the UPS negotiators look reasonable compared with the writers’ guild or UAW. The latter (mostly the writers’ guild) seem to be killing their hosts, cannibalising long-term economics for short-term gains.
Do you see a path forward for American labour that is less adversarial? Or is this endemic to labour unions and shareholder management?
> Do you see a path forward for American labour that is less adversarial? Or is this endemic to labour unions and shareholder management?
I appreciate you asking. The path forward, in my opinion, is the "German model" [1] [2] where Labor is another seat at the Board and has representation at the top of an enterprise. How we get from here (where inequality of power, wealth, and cashflow is so great [3]) to there will be messy. No one wants to cede power willingly [4], and the pendulum swung too far towards Capital and management over the last half century (which makes it all the more challenging to find equilibrium). You need reasonable people who are not too self interested and understand why optimizing for the long term is desirable in positions of leadership. These people seem to be in short supply, in my experience. You also need trust (hard earned and easily lost) that those you have delegated your authority to will do the right thing.
TLDR Prisoner's dilemma cake cutting thought experiment. One person cuts, the other person picks the slice. Record profits are grossly underpaid wages. Target less profits (but still profits to account for capital at risk) and higher worker compensation.
[4] https://www.goodreads.com/quotes/951719-power-concedes-nothi... ("Power concedes nothing without a demand. It never did and it never will. Find out just what any people will quietly submit to and you have found out the exact measure of injustice and wrong which will be imposed upon them, and these will continue till they are resisted with either words or blows, or with both. The limits of tyrants are prescribed by the endurance of those whom they oppress." -- Frederick Douglass)
One takeaway, this particular new union leader is the first directly elected one in a very long time. Prior to this the union leader was selected in a good 'ole boys manner by union reps and sort of rotated. After the justice department found quite a bit of graft and bribery they required a new election and Shawn Fain won in a razor thin recount.
As a result the UAW for the first time in a long time got a populist representative of the average union worker, thus the hard line strike. So for those of you against unions because of corruption, etc. This is what it looks like when there is at least less of that, a good thing.
https://www.nytimes.com/2023/09/12/podcasts/the-daily/ford-g...