Most years in the US, there is some labor strike or vote to unionize that seems to stand out as important inflection point in the direction of labor In the US – as the fortunes of unions in the US manufacturing sector continues to head downward.
In 2019, that inflection point may be the battle between workers at (now) locomotive maker Wabtec and management at the company's factory not far from Erie, PA.
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It pits members of the United Electrical, Radio and Machine Workers of America, former employees of the GE Transportation, against the plant's new management.
The catalyst for the strife: After Wabtec recently acquired the locomotive factory from General Electric, it almost immediately demanded significant concessions from the workers.
Management says it is willing to keep the existing workers at the current average of about $35 per hour – not a bad living.
But in return, like automakers and many other US manufacturers before it, Wabtec wants to create a second pay tier for new workers, with wages of $16.75 to $25 per hour.
"The fight between the Erie workers and Wabtec shows that despite our collective popular imagination about American manufacturing jobs, the current reality and the future of a promise of "good-paying work" are quite different," write Moshe Zvi Marvit and Andrew Stettner, both fellows at the Century Foundation, in a recent opinion piece in the New York Times.
They note that for the past couple of decades, US manufacturing wages have grown at just 1.4% per year, just about half the pace of an average American worker, and less than the cost of living.
It's not as if Wabtec is struggling. It had profits of $256 million through the third quarter of 2018.
"The company's position is that it is demanding lower wages because it can, a fact that was evident in a Wabtec spokeswoman's explanation that the company's current pay scale ‘is exceptional for that region,'" Marvit and Stettner say.
They also note that upon the completion of the Wabtec acquisition of the GE business, the company's CEO will a bonus of about $16 million.
The authors say low wages is a key reason behind the large and growing shortage of US manufacturing workers, estimated at some 2.4 million ten years out.
"Unable to consistently recruit workers to the industry because of low pay, factories now rely on temporary staffing agencies to recruit workers for less-skilled front-line jobs and hold on to their most skilled workers well into their 60s," Marvit and Stettner say.
That formula that won't work much longer, the argue, adding that "The unions are offering Wabtec and the rest of manufacturing a different and more promising path: Rebuild the wage premium in manufacturing as a way to retain and attract the next generation of skilled manufacturing workers."
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Oddly, after threatening multiple times to close the Erie facility and move remaining work to Texas, Wabtec is seeing strong order growth, such that the company is wants to require mandatory overtime from the union to meet the surging demand as part of a new deal.
 Earlier in March, both sides came to an agreement, sought by the union, to continue working under the terms of the old agreement for 90 days while the two parties worked to negotiate a long-term contract. Those discussions continue on, with the temporary agreement set to expire June 6.
"I think both sides, we are committed to getting this thing done. We have a deadline, and we have to meet that deadline," said Scott Slawson, president of UE Local 506, which represents all but a handful of the plant's nearly 1,700 union workers.. "Both sides are working to get that done."
Wabtec spokesman Tim Bader was equally upbeat when discussing last week's negotiations.
"Both sides were engaged and the discussions have been constructive," Bader said. "Talks are scheduled for next week and the weeks following. We continue to be optimistic that a mutually beneficial agreement will be reached."
However, Wabtec has blamed the union for the strike, portraying its proposals as in line with its other plants and necessary to compete with "low cost" plants in China and Mexico."
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