Crisis Averted? What To Know About the Rail Strike That Wasn’t

Riding the Rails

Midweek, things looked bleak for the nation’s railroad network. But after a marathon negotiating session, the Biden administration announced a tentative deal had been reached to avoid a rail strike. Analysts warned a work stoppage of that kind would snarl transportation of goods and workers, upending the economy and sending inflation higher.

As part of the deal, union members will get a 14% raise immediately, as well as back pay dating back to 2020. In addition, there are built-in raises totaling 24% through 2024, when the current five-year contract expires. On average, union members are looking at $11,000 in payment.

Still, money aside, work rules and scheduling issues were reportedly the biggest roadblock in negotiations. Details aren’t yet clear, but it would appear the rail unions achieved major concessions in that area.

Money Isn’t Everything

Prior to Thursday’s breakthrough, several rail unions had already agreed to deals, centered on the 24% pay increase. Of those that had not agreed was a union representing two-person crews on freight trains, made up of a conductor and engineer. The representatives from those unions argued the staffing and scheduling rules requiring members to always be on call were unacceptable. Notably, a freight train disruption would have further challenged the already beleaguered supply chain.

Simply put, employees seem to be demanding better working conditions. This same is true of a nurses strike in Minnesota, which reportedly centers on scheduling and staffing issues. In California and Hawaii, Kaiser Permanente health professionals are on strike due to alleged insufficient staffing.

Wages vs. Inflation

While there are undoubtedly concerns beyond money when it comes to negotiations between employers and employees, wages are certainly a point of contention. In that respect, many American workers say things are getting out of whack.

A new survey from Bankrate suggests wages, which admittedly grew throughout the pandemic, aren’t keeping pace with the rate of inflation. With pricing rising at the fastest rate in 40 years, 55% of respondents say their income has fallen behind everyday expenses. Meanwhile, the nation is experiencing a labor shortage. The next few years could be instrumental in shaping the worker experience.

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James Flippin ABOUT James Flippin James Flippin is the son of a financial advisor who grew up hearing and learning about bond yields, interest rates, the stock market, and the ins and outs of Wall Street. After stints as a licensing and business broker for Marcus and Millichap in New York City, James moved into broadcasting and became a reporter and anchor. He covered crime, politics, finance, and tech at NBC News Radio while working part-time as a producer for SiriusXM. James graduated from the University of Delaware with a bachelor’s degree in political science and economics. He's also an accomplished podcaster with over 10-years of experience.

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