Saturday, April 3, 2010

labor unions and compensation demands during a deep recession

A lot of interesting stuff in this report by Jere Downs in the C-J...

Welders, painters and crane operators walked off the job Friday at American Commercial Lines’ Jeffboat shipyard, idling barge production in the first Teamster strike since a 10-week walkout in 2002.

Interesting timing: in a weak economy. As we'll see, th weak economy leads to downward pressure on compensation which is likely to irritate workers. Those in a union (labor market cartel) are least likely to stand for such an outcome.

Increased healthcare costs proposed by the company Thursday on the eve of the expiration of a three-year labor agreement precipitated the strike...

That will be more and more of a problem; it'll be interesting to see how workers-- union and non-union-- respond...

“They want to take money from us in this contract,” pipe welder Eric Caines, 32, said...

An interesting view of voluntary, mutually beneficial trade. Then again, when a labor market cartel has such monopoly power, it can be quite adversarial...

ACL is offering “the same healthcare we have for all of our ACL non-union employees, from the deckhand to the CEO,” Mike Ryan, company president and chief executive said in a prepared statement.

“I don’t care what their non-union people have,” Teamster Local 89 President Fred Zuckerman said...

An interesting look into the apathy/hostility toward non-union people...It'll be interesting to see if this bites them in the butt later.

ACL’s offer also proposes no wage increase in the first year, with 1 percent and 2 percent annual increases thereafter, striking Teamsters said.

“It all adds up to a pay cut,” Caines said.

Right. In a severe recession, that's what you typically get.

It's odd and potentially devastating decision by the union to have its members step out at this point in the economy. Stay tuned...

1 Comments:

At April 3, 2010 at 11:08 PM , Blogger briefs said...

Our labor economy in NW Indiana is so heavily dominated by organized labor that this seems so commonplace. I'm glad the rest of Indiana gets to see the hypocrisy though.

 

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