I got about a half-dozen e-mails over the weekend from Machinists about BizWeek’s latest story http://www.businessweek.com/magazine/content/05_39/b3952115.htm on the Machinist union strike.
Stan Holmes ran some numbers and calculates that the difference between what the Machinists wanted and what Boeing offered was far less than the $1 billion figure Boeing Commercial Airplanes chief Alan Mulally has cited.
Key Quote: “In fact, the differences between the parties boil down to something closer to $90 million, according to union and company data analyzed by BusinessWeek.”
Given that, Holmes says analysts are wondering why Boeing just doesn’t settle the strike.
Key Quote 2: “Whatever the exact figures, the sums causing the impasse are essentially rounding errors for a company that hauls in $54 billion in annual revenues. With any savings to Boeing soon to be eaten up in the strike’s first month, what’s really driving Boeing remains a mystery.”
Tuesday, btw, will be Day 19 of the strike, which means this is going to be at least as long a walkout as the strike of 1965, which went 19 days — the shortest-ever IAM strike against Boeing.
In other strike-related stories, the L.A. Times on Sunday took a look at the strike in terms of outsourcing and offshoring. http://www.latimes.com/business/la-fi-boeing18sep18,0,6536347.story?coll=la-home-business
Key Quote: “Economists say (outsourcing has) been good for the overall economy because it has kept wage inflation in check and interest rates low. Just ‘the threat of outsourcing’ has allowed employers to keep a lid on compensation while increasing productivity and profits, explained Tobias Levkovich … with Citigroup Smith Barney in New York. But for most Americans, that means wages failed to keep pace with rising living costs in 2004, according to the Labor Department … The overall hourly wage for American workers was $18.09 in July 2004, up 1.9% over the previous year. Over the same period, inflation rose 3%.”
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