How Strike Results Affect Your Retirement Plan
Strikes are painful, both for the workers involved and for their communities. But they can also be transformative.
In this article we will explore some of the most important lessons learned from past strikes. We’ll look at what makes a strike successful, and some of the key problems that can arise when strikes go wrong.
1. Higher wages
After years of anemic wage growth and shrinking budgets at the Department of Labor and state agencies charged with protecting workers’ rights, many American workers have stepped up to demand higher wages, manageable work hours and better contracts. Strikes have become one of their main tools to exercise their bargaining power, as evidenced by a recent upsurge in major work stoppages.
As a result, a growing share of Americans now live in states where a raise in the minimum wage would significantly increase their annual earnings. But pay is just one of the issues that drive workers to strike, and their concerns often run much deeper than compensation alone. For instance, a study found that when stores raised their minimum wage, sales increased, but the boost was largely driven by lower-performance workers who increased productivity.
2. Better working conditions
Working conditions encompass a broad range of issues, from pay to workplace safety. As such, they can impact a strike’s outcome in many ways.
For example, workers might demand better working conditions if they believe that their needs and concerns are not being taken seriously by management. However, workers should be encouraged to focus on improving their own professional skills rather than just demanding better working conditions from employers.
My research shows that the quality of management-worker relations is a key factor in determining strike results. For example, when employees on the third shift of a nonstrike plant feel overlooked or bypassed by management, they might vote for a strike. In contrast, managers in the nonstrike plants may be able to turn a potential adversarial climate into a problem-solving environment by encouraging informal meetings between their employees and union representatives.
3. More job security
At the moment, the Big Three automakers don’t have as dominant a position in the economy as they did in past decades. That means a long strike by the UAW might not cause lasting damage, assuming it’s resolved quickly.
But the union is arguing that automakers should share their record profits with workers after years of buybacks and executive bonuses, while also pushing for stronger job security in the shift to electric vehicles. The UAW’s proposals call for shorter work weeks and the restoration of traditional pensions.
Frontline workers are also striking in droves. Nurses have staged walkouts to demand reasonable contracts that guarantee staffing and safety at their hospitals, especially in light of COVID-19’s ability to shut down businesses and max out supply chains.
4. Better health care
The results of the UAW strike authorization vote should be announced Friday. If it passes, the union will be able to strike automakers and their suppliers.
The UAW is seeking higher wages and a shorter work week. It also wants to protect health benefits and retiree pensions.
Nurses at Montefiore Medical Center in the Bronx and Mount Sinai Hospital in Manhattan walked out because of alleged unsafe staffing levels, high turnover, low wages, and a failure to address their concerns during contract negotiations.
5. Better retirement benefits
Whether you can depend on your 401(k) or other employer-sponsored retirement plans to give you a secure financial future will depend in part on how long the autoworkers’ strike lasts and how big it is. But it’s too early to tell what impact the UAW strike will have on the economy overall.
Who: Nurses and a handful of radiology technologists at Allina Health in Minneapolis and Fridley, Minnesota. Why: The hospital administration’s alleged refusal to negotiate a first contract that includes safe staffing ratios, adequate health benefits and fundamental workplace protections.
The nurses’ strike also demonstrates horizontal solidarity — cooperation among different unions, a trend that’s rare in recent labor strikes. That could help the strike’s results, says a Rutgers University professor. It will also put more pressure on the company to settle quickly.