New contract bargaining between the United Auto Workers union and American automakers is scheduled for next year. Recently, we’ve been getting a clearer picture of the union’s priorities. UAW President Dennis Williams has indicated members want to eliminate a recently introduced feature of the autoworker landscape: “two-tier” wages and benefits.
Back in 2007, the bottom was about to fall out of the U.S. automobile industry. Sales eventually plunged and two of the “Detroit Three” would be bailed out of bankruptcy by the U.S. government.
Part of that painful reckoning was the implementation of lower wages and fewer benefits for new hires at GM, Ford and Chrysler. The car companies used the savings to invest in factories and more hiring workers. Instead of raises, the companies have occasionally paid out one time bonuses and profit sharing. But today, more workers say it’s time the two-tier structure to go away.
Current State talks with Sean McAlinden, executive vice president of research and chief economist at the Center for Automotive Research in Ann Arbor.
