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A 10-day UPS strike could be the costliest in US history

By Chris Isidore

A 10-day UPS strike could cost the US economy $7.1 billion. That could make it the costliest work stoppage ever in US history, according to an estimate from a Michigan economic research firm that studies the costs of labor disruptions.

The estimate from Anderson Economic Group said the hit to businesses and consumers would be $4.6 billion by itself, causing “significant and lasting harm for small businesses, household workers, sole practitioners, and online retailers across the country.”

Other costs include estimated direct losses at UPS of $816 million, as well as $1.1 billion in lost wages by 340,000 members of the Teamsters union at the company. The remaining costs would be born by UPS suppliers and from lost tax revenue.

The union has said it will go on strike August 1 without an agreement on a new contract. Talks broke off last week with both sides accusing the other of walking away from the table.

The Teamsters union did not have an immediate comment on the study. It has said in the past that if there is a strike it will be the fault of the company for not stepping up and agreeing to the economic package being sought by the union despite having its earnings nearly double during the life of the current five-year contract.

UPS said that it won’t comment on third-party research and that it is still hopeful of reaching an agreement with the union to avoid a strike.

“Our focus is on negotiations rather than speculation,” said UPS spokesman Glenn Zaccara. “We remain confident that we will reach an agreement that is a win for our employees, our company and customers, and the union.”

UPS did say Friday that it has started to train its nonunion US workers, including managers to help continue at least some of the company’s operations if there is a strike. UPS has nearly 100,000 nonunion employees in the United States as of the end of last year.

“While we have made great progress and are close to reaching an agreement, we have a responsibility as an essential service provider to take steps to help ensure we can deliver our customers’ packages if the Teamsters choose to strike,” said a statement from the company.

UPS handled an average of 20.8 million US packages a day last year. It would only be able to handle a fraction of that volume if there is a strike, said Satish Jindel, president of ShipMatrix, a software provider that works with the parcel shipper. But he said that UPS will concentrate on trying to deliver international shipments and high-value expedited shipments.

Asked if nonunion employees have been told they can’t schedule vacations starting August 1, Zaccara said, “We are asking management employees to be at the ready, should we need them.”

UPS has had only one national strike in its history, a 16-day strike in 1997 by the Teamsters. During that strike it essentially shutdown all US operations and did not try to make deliveries. Back then the company had 180,000 Teamster-represented employees during that strike, slightly more than half the numbers it has now, and it was far less central to the US economy, said Patrick Anderson, president of Anderson Economic Group.

“It wasn’t a tech-centric economy built around small package delivery then,” said Anderson.

Anderson said estimates of the cost of earlier strikes goes back only 100 years, and that this would be the costliest he could find in that time frame. The $7.1 billion cost estimates would nearly double the $4.2 billion total economic hit of the costliest recent strike, the 2019 strike at General Motors. And that strike lasted six weeks, not just 10 days.

He said that the cost of the strike would be limited if it only lasts a couple of days, but would increase rapidly after that.

“The damage clearly grows day by day,” he said.

  • Moohamin12
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    1 year ago

    ‘Rich greedy people could cost the country $7.1 Billion.’

    There. That sounds more accurate.

    • 133arc585@lemmy.ml
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      1 year ago

      Yeah it’s disingenous as a headline. UPS is costing the economy $7B, not the strikers.

  • meowchiminh@lemmy.world
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    1 year ago

    One of the hosts of the podcast Minion Death Cult works for UPS and has talked about this a lot. Seems like the Sean O’brien, the teamsters president, is militant and doesn’t fuck around.

  • metaltoilet@beehaw.org
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    1 year ago

    Hollywood on strike; UPS maybe on strike; rail workers, prime deliverers, and Fed-Ex have super high tensions right now. Maybe I’m naive but we could have a general strike here. Spread the news people!

  • HarleyD@lemmy.world
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    1 year ago

    The White House stopped the rail strike, what are the odds they will do the same here? Or, is the UPS CEO not a rich friend of the Bidens?

    • Scrotal_Sophistry@lemmy.fmhy.ml
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      1 year ago

      As far as I’m aware, congress was in a unique position to intervene specifically with the rail strike. I’m not so sure those privileges extend to carrier services like ups or FedEx. That likely won’t stop the feds from doing some fuck shit, but they’re in a less legally justifiable position to do it

  • borlax@lemmy.borlax.com
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    1 year ago

    Sounds like a lot of fun. What’s even better is CNN is already planting the seeds to blame workers for the upcoming recession.

    • 133arc585@lemmy.ml
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      1 year ago

      CNN is already planting the seeds to blame workers for the upcoming recession.

      Of course they are. Even the title of the article does that: they put the blame of the economic impact on the strike(rs), not on UPS. An honest title would read something like: UPS could cost the USA economy $7.1B. An even more honest one would hint at the actual reason for such greed, but I’d settle for getting the blame properly assigned.

        • 133arc585@lemmy.ml
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          1 year ago

          Yeah, it’s not out of character unfortunately. It’s just an extension of the “strikers/unionizers are greedy bastards” rhetoric that’s common in the USA. They’ve done a good job of painting advocating for your rights as a laborer as being “greedy”.