Labor negotiations, like so many tussles in a free society, are rarely pretty. The current mess involving the Boeing Co. and the International Association of Machinists and Aerospace Workers is a case in point, but it goes beyond that. It’s an illustration of just how severely the world’s business winds have shifted.
The current economic climate, characterized by recession, layoffs and a downturn in the airline industry that could lead to major restructuring, has led to hardened positions on both sides. Indeed, this negotiation is a historic showdown, with the power of both the union and company at stake.
So it’s not surprising that as the current contract reaches its expiration date today, the tone of the debate has become particularly nasty.
While the sides are far apart on benefit issues — pensions and healthcare — the central stumbling block appears to be job security. The benefit issues are the stuff of traditional collective bargaining, and the company should show more willingness to move on them. The job-security issue, however, has both sides digging in their heels. How it gets resolved will go a long way toward determining how effectively Boeing can do business in the 21st century.
This isn’t your father’s world, and it can’t be your father’s Boeing anymore.
Many of Boeing’s best customers are in desperate shape. US Airways has filed for bankruptcy protection, and United Airlines may soon do the same. Both are seeking huge concessions from their own unions, including the IAM. Boeing’s chief competitor, Airbus, has wrested away market share with attractive pricing. Like so many companies in other industries, Boeing has been forced by market realities into an ongoing process of cutting costs and improving efficiency. The 30,000 Boeing workers laid off in the past year can speak to the human toll these realities exact.
Given all this, one kind of job security the union is seeking — tying employment levels to revenue or production orders — is unrealistic. Today’s successful companies must be nimble, able to control costs while responding to ever-changing market conditions. Employment-level guarantees would unreasonably hamper that ability.
Some Machinists have identified Wall Street as an evil force lurking behind the scenes, demanding ever-greater profits. Well, here’s another new reality: Wall Street is not a bunch of faceless fat cats. It’s all of us who have retirement and other savings invested in mutual funds, many of which include Boeing stock. We’re all dependent on the ability of companies like Boeing to remain successful in a changing world.
Those who resent the Machinists for trying to get more in collective bargaining even though they’re already ahead of most area workers in pay and benefits are misguided. Good-paying jobs are critical to any community’s success, and Boeing’s Machinists give plenty back in the form of spending and generous contributions to charity. It’s every American’s right to work toward the best deal they can get from their employer.
Still, union members must face market realities. Good jobs will remain at Boeing only as long as the company is successful. Job guarantees like the union is seeking would put a potentially lethal drag on Boeing’s competitiveness. And with the current state of the airline industry, the union has little leverage in making this demand.
Union members would be wise to accept this sooner than later, focusing instead on the best package of pay, benefits and work rules they can get.
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