AFP
KEY POINTS
- As many as 340,000 UPS workers could strike soon
- UPS and its union, the International Brotherhood of Teamsters, are expected to resume negotiations on Tuesday
- A 10-day strike could cause as much as $7 billion in damage to the U.S. economy
There could be a major delay on the next item delivered to the doorsteps and loading docks of homes and businesses around the world.
On Aug. 1, about 340,000 United Parcel Service Inc. employees represented by the International Brotherhood of Teamsters could begin a work stoppage that could cause billions of dollars of damage to the U.S. and world economy. The two sides are expected to resume negotiations on Tuesday to avoid a strike.
In an interview with International Business Times, Anderson Economic Group Principal and CEO Patrick Anderson said a strike would be felt by every American as the freight handled by UPS cannot be easily transferred to other carriers.
Anderson said a 10-day strike of that scale would cause about $7 billion in damage to the U.S. economy due to lost productivity. That, he said, is a conservative estimate and the costs could actually be much higher.
“A 10 day strike … would create as much damage in terms of lost wages and losses to businesses and consumers as any strike in the last 100 years in the United States,” Anderson told IBT. “It’s also a choke point in the modern economy that’s never really been pinched before.”
Globally, a work stoppage would harm: the automotive and manufacturing industries that rely on specialty parts shipped from around the world; the healthcare industry and patients who rely on perishable medicines and even the finance industry since many high-value contracts must still be delivered and signed by hand.
On July 31, the Teamsters’ labor agreement with the UPS is set to expire. This would mean the 340,000 full- and part-time workers represented by the trade union would stop working in demand of better pay, improved working conditions and more time off.
The union says its contract with the Atlanta-based logistics company is the largest labor agreement between a private sector employer and a union. In early July, negotiations between UPS and the Teamsters about extending their contract collapsed, according to a release from the union.
Anderson said he anticipates UPS, and businesses around the world, are already planning for what to do if a strike comes to pass. However, he said the collective capacity does not exist between all the other public and private carriers in the U.S. to replace the logistical needs currently filled by UPS. Less than a quarter of that freight could actually be handled by another carrier.
Larger businesses may still be able to find alternative means for moving necessary and perishable goods but smaller ones that cannot will be particularly harmed. In less than a week, small businesses that can’t get the supplies they need will run the risk of being forced to close due to lack of necessary goods.
