Union has leverage in Boeing talks

The Boeing logo on the company's corporate world headquarters building in Chicago, Ill.

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Kai Ryssdal: One reason the Federal Reserve pays so much attention to inflation is because it's insidious in a lot of ways. You don't necessarily notice it on a daily basis, but year after year, it can really take a chunk out of your paycheck. That's something the machinists union at Boeing will be thinking about as they begins their last round of contract negotiations this week. The country's biggest airplane maker is trying to draw a line in the sand on pension and health care costs. But it's also desperate to get its new 787 Dreamliner out the door. Marketplace's Steve Henn reports.


Steve Henn: Deliveries for Boeing's new plane, the 787 Dreamliner, are 18 months behind schedule. A strike now would be bad.

Tim Healy: There's never a good time.

Tim Healy's Boeing's spokesman.

Healy: You know we have commitments, and not just the 787. The 737 has five years of backorders, and the triple 7 and the 767. The company has a huge backlog of orders and has hired thousands of new workers. That puts Connie Kelliher at the union in the catbird seat.

Connie Kelliher: It's definitely one of the best bargaining positions we've had in years.

Machinists want a raise, a cost of living increase, guaranteed pensions and for Boeing to keep paying for most of their health coverage. Boeing's Healy says they'll win some concessions.

Healy: We've been successful. Employees deserve to share in that success. They deserve to share in that success. They're earned it and we're gonna do it.

U.S. Steel workers just inked a generous contract of their own. And these kinds of deals have caused at least one member of the Federal Reserve to warn that rising wages could spark an inflationary spiral. But machinists at Boeing have leverage other workers don't.

Ross Eisenbray: Machinists have skills that are in very short supply.

Ross Eisenbray at the Economic Policy Institute says almost everyone is hurting.

Ross Eisenbray: It's a very bad time to be an hourly worker. Rising unemployment rate, payrolls are declining and the under employment rate is nearly 11 percent.

In fact, in the past year real wages actually fell 2 percent when adjusted for inflation.

In Washington, I'm Steve Henn for Marketplace.

About the author

Steve Henn was Marketplace’s technology and innovation reporter for the entire portfolio of Marketplace programs until December 2011.

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