The Importance Of The United Auto Workers’ Victory

This article is part of TPM Cafe, TPM’s home for opinion and news analysis.

If it weren’t for the war in Israel and the election of an abortion absolutist and lesser-known election denier as Speaker of the House alongside a handful of other breaking news events in the last six weeks, the United Auto Workers strike with the three major auto companies would have been the biggest news story in the country.  

After the strike began on September 15, the union staggered the walkouts at different facilities at different times in order to keep the companies guessing and to escalate when additional pressure was needed, rather than have all 150,000 members who work at the three companies walk out at once. Altogether, about 34,000 workers at nine auto factories and 38 parts warehouses in over 20 states walked off the job. It marked the first time in the union’s history that it went on strike at all three companies simultaneously. Ford was the first company to reach an agreement with the union on Wednesday, followed by Stellantis (the parent of Chrysler, Jeep and Ram) on Saturday, and then General Motors on Monday. GM caved in less than 48 hours after the union struck its largest North American factory in Spring Hill, Tennessee. 

The UAW scored one of the most impressive union triumphs in the past 50 years. The workers and their union won:

• 67 percent boost to the starting wage for new hires to over $30 per hour over the next four and a half years  
• 33 percent increase on the top wage from $32 to no more than $42 an hour over that period
• 25 percent overall pay increase and reinstatement of annual cost-of-living adjustments that the UAW lost in 2009
• An end to the two-tier wage system through which some workers make lower starting salaries and get lower pay increases 
• Boosts to retirement income, including an increase in 401(k) contributions from 6.4 percent to 10 percent 
• The right to strike if the automakers seek to close factories and lay off workers

In addition, temporary workers will become full-time employees after nine months of continuous employment.

“We have slammed the door on having a permanent underclass of temporary workers,” UAW president Shawn Fain said.

The UAW also scored a pioneering victory for both union jobs and climate justice – two goals that some pundits claim to be at odds. The tentative contract includes Stellantis’ agreement to reopen a factory in Belvidere, Illinois that once employed 1,200 UAW members and to add a new electric vehicle battery plant nearby that will employ another 2,000 to 3,000 workers. The company also agreed to invest $155 million into an electrical vehicle factory in Indiana. GM agreed to allow workers at its electric vehicle battery plants to be covered by the collective bargaining contract. 

The tentative contract settlement still needs to be ratified by the union’s rank-and-file members.

The union’s core message throughout the strike was simple: after years of stagnant wages and painful concessions, workers should share in the auto industry’s prosperity.  

Walter Reuther, the UAW’s visionary president from 1946 until his death in 1970, once said that, having helped the nation win World War II, America’s workers deserved, “as a matter of right – not as a matter of collective bargaining muscle – to share in the fruits of advancing technology.” In its heyday, and occasionally through strikes involving hundreds of thousands of auto workers, the UAW won significant pay raises, overtime compensation, health care benefits, robust pensions and paid vacation days that became the model for other unions. Reuther even insisted that the auto companies’ profits were so big that they could afford to increase wages and benefits without increasing the price of their new cars — an idea that captured the public’s imagination but which the union didn’t win at the bargaining table. 

Echoing his predecessor, Fain called the new agreement “a turning point in the class war that has been raging in this country for the past 40 years.”  

In a video address to UAW members, he proclaimed: “They underestimated us. They underestimated you.”

The UAW strike — as well as recent strikes by unionized grocery workers, school teachers,  TV and screenwriters,  actors, hotel workers, Kaiser Permanente health care workers in California, graduate students, and others —  is part of a significant upsurge in worker activism in the U.S. in the last few years. So too are the growing efforts by employees who are not in unions – including those at Starbucks and Amazon – but would like to be.

One sign of workers’ changing mood is the increase in unionization efforts. Between October 1, 2022 and September 30, 2023, American workers filed 2,594 petitions for union representation to the NLRB, a 58 percent increase from the 1,638 petitions filed two years earlier.

This growing discontent is part of an effort to reverse several trends.

Since the 1970s, the nation’s wealth and income gap has widened dramatically. Between 1978 and 2019, the richest 0.1 percent of Americans increased their earnings by 341 percent in inflation-adjusted dollars, while the earnings of the typical worker grew only 18 percent, according to the Economic Policy Institute. Another measure of widening inequality is the compensation gap between corporate CEOs and typical workers. In 1965, the average compensation of the CEOs of major corporations was 21 times greater than the pay of the median workers in their own firms. By 1989, the gap had risen to 61 times. By 2020, it had skyrocketed to 351 times the typical pay of workers.

Last year, for example, Ford CEO Jim Farley earned $21 million in total compensation — 281 times more than the company’s typical worker, according to filings with the Securities and Exchange Commission. General Motors CEO Mary Barra earned nearly $29 million — 362 times more than the typical GM worker. Stellantis CEO Carlos Tavares made $24.8 million, 365 times more than the median worker. 

Additionally, for several decades American corporations have gone on a spree of mergers and consolidations, while laying off employees and weakening workers’ leverage in order to increase profits. According to a recent Congressional report by the House Joint Economic Committee, “the erosion of (corporate) competition costs U.S. workers more than $1 trillion in lost income each year, a drop in living standards of more than $5,000 per year for the typical American household.”  Two companies — Pepsi and Coca Cola — now sell over 70 percent of all soft drinks in the U.S. The four largest airlines — American, Delta, Southwest, and United — control 67 percent of domestic air travel. The four largest commercial banks — JPMorgan Chase, Bank of America, Wells Fargo, and Citibank — control half of all bank assets in the United States.  The five largest food retailers — Walmart, Kroger, Costco, Albertsons, and Sam’s Club — have 58 percent of the nation’s American grocery market, with Walmart alone commanding 25 percent of all grocery sales. The United Food and Commercial Workers union is currently challenging Kroger’s plan to merge with Albertsons, which would increase the concentration even more and result in wide scale layoffs. 

The growing wave of worker activism seeks to restore the labor movement to the powerful role it played in the United States from the 1930s through the early 1970s, when its leaders were well-known and mostly admired public figures. It was the labor movement that lifted workers into the middle class, brought us the weekend (the 5-day work week and 8-hour day), pushed for Medicare and Medicaid and inflation-adjusted Social Security, got Congress to adopt workplace safety laws, a minimum wage, government-subsidized housing, played a key role in passage of the Voting Rights Act, Civil Rights Act, and Fair Housing Act, and pushed for laws and policies to reduce the gender pay gap. 

Union membership began to decline in the 1970s, from one-third to about one-tenth of all workers today — and only six percent in the private sector. American-owned corporations shut down unionized factories (in steel, electronics, chemicals, cars, aerospace, apparel, and other industries), or moved their manufacturing facilities to anti-union Southern states or overseas to low-wage countries.

For example, the proportion of U.S.-made clothing sold in this country fell from about 90 percent in the 1960s to less than 2 percent today. The UAW, which at its peak in 1979 had 1.5 million members, now has only 400,000. Even that latter figure includes many employees who don’t work in the auto industry. In recent years, the UAW has added new members who work at hospitals, colleges and universities, small manufacturers, non-profit organizations, and state and local governments. The current victory is likely to embolden the UAW to launch organizing drives among workers at Honda, Tesla, BMW, and Toyota factories, most of which are located in the South. 

The exodus of blue-collar jobs — often called “deindustrialization” — has had devastating consequences on tens of millions of families and many once-thriving cities. The population of Detroit, the center of the American car industry, fell from 1.5 million in 1970 to 639,111 in 2020. Youngstown, Ohio, once a vibrant steelmaking center, went from 160,689 residents in 1960 to about 60,000 today. 

Meanwhile, many unions suffered from irresponsible and even corrupt leadership. They neglected to respond to key changes in the American workplace and failed to organize unorganized workers, especially immigrants, people of color, and women in the retail, high tech, higher education, and service sectors.

While widening inequality, dampening wages, increasing corporate consolidation, and rising business profits have triggered growing workplace activism, other factors are also at play. The COVID pandemic, starting in 2020, gave workers a growing sense of frustration, restlessness, and recognition of their employers’ indifference to their health and safety. In addition, housing costs and rents have been rising much faster than wages, putting many families in a precarious situation. A survey of grocery workers last year found 44 percent said they couldn’t pay their rent and, ironically, 39 percent were unable to pay for groceries. Fourteen percent said that they had been homeless during the previous year.

The upsurge of worker activism is also the result of the increasing pro-union atmosphere fostered by President Joe Biden, arguably the most pro-union president since Franklin D. Roosevelt.  Last month Biden grabbed a bullhorn and urged striking auto workers in Michigan to “stick with it,” saying “you deserve the significant raise you need.” He is the first U.S. president in modern history to join a union picket line. His appointees to the Department of Labor and the National Labor Relations Board (NLRB) have been resolutely pro-union. 

A new generation of union leaders and rank-and-file workers have been revitalizing the once-slumbering labor movement. Fain, the 55-year old UAW president, is a former Chrysler electrician from Indiana. He won the presidency last year by defeating the old guard leadership and his slate won half the seats on the union’s executive board, running on a platform promising “No corruption. No concessions. No tiers.” 

Fain and his counterparts in other unions have been building bridges with community, religious, civil rights, and environmental groups and developing new strategies to focus attention on the undue economic and political influence of corporate America. Last year, for example, unions in Los Angeles joined with housing activists to pass a citywide real estate tax on properties selling for over $5 million, which will generate between $500 million and $1 billion a year for new affordable housing development and rent subsidies for vulnerable tenants. In November, the ballot measure won with 57 percent of the vote.

A Gallup poll last year found that 71 percent of all Americans supported unions, the highest level since 1965. Younger Americans — those between 18 and 34 — are the most supportive. This year, Gallup discovered that 72 percent of Americans sympathize more with the striking TV and film writers than with the television and film production studios, and that 75 percent of Americans side with the UAW in their battle with the auto companies. 

The growing workplace activism is taking place despite the fact that American workers have far fewer rights at work than employees in other democratic societies. Current federal laws are an impediment to union organizing rather than a protector of workers’ rights. The rules are stacked against workers, making it extremely difficult for even the most talented organizers to win union elections. 

Under current NLRB regulations, any employer with a clever attorney can stall union elections, giving management time to scare the living daylights out of potential recruits. Many employers illegally fire at least one employee during union-organizing campaigns. The lucky workers get reinstated years later after exhaustive court battles. Thanks to the efforts of anti-union Republicans in Congress, penalties for these violations are so minimal that most employers treat them as a minor cost of doing business. Employees who initially signed union cards are often long gone or too afraid to vote by the time the NLRB conducts an election.

The situation among Starbucks employees illustrates this dilemma. Since 2021, baristas at more than 350 Starbucks stores (among the over 9,000 company-owned locations) have voted to unionize and affiliate with the Service Employees International Union (SEIU), but no workers at any store have yet won a contract with the company, which has engaged in persistent and illegal union-busting. 

Big business spends hundreds of millions a year to hire anti-union consultants to intimidate workers from participating in or showing support for union campaigns. Employers can require workers to attend meetings on work time during which company managers give anti-union speeches, show anti-union films, and distribute anti-union literature. Unions have no equivalent rights of access to employees. To reach them, organizers must visit their homes or hold secret meetings. This is hardly workplace democracy.

If the Democrats win the White House, Senate, and House next year, one of its first priorities should be to pass the Protect the Right to Organize (PRO) Act, a reform of federal labor laws supported by Biden and most Democrats in Congress, that includes strong penalties for employers who violate workers’ rights, makes it easier for workers to unionize, and would increase the percentage of union workers from the current 10 percent level. 

A stronger labor movement helps all liberal and progressive reform movements and causes. That’s because unions use their resources to help elect liberal and progressive politicians (mostly Democrats) who are not only pro-worker, but also (with a handful of exceptions) pro-environment, pro-choice, pro-LGBTQ equality, pro-immigrant, pro-public schools (and school teachers), pro-voting rights and pro-gun control. 

A stronger labor movement is needed to have a healthy democracy and to offset the inordinate influence of corporate America in our political system. Strong unions not only give ordinary Americans a voice at work but also a voice in the larger society.

“We have shown the companies, the American public and the whole world that the working class is not done fighting,” UAW president Fain said over the weekend. “In fact, we’re just getting started.”