What a National Rail Strike Would Mean for the Supply Chain, and How the Government Is Reacting to the Possibility
The federal government is gearing up for the possibility of a railroad strike that could affect travelers and economic endeavors alike.
While rail worker unions have found tentative agreements with management this week, two other unions representing engineers and conductors are still at the negotiating table. According to CNN, if they don't find a solution, the first national rail strike in 30 years could begin on Friday.
The two unions are fighting for better quality-of-life measures to be included in a new contract, including attendance policies, and vacation and sick days.
"If this contract is presented to our members in its current form, it will not pass," a labor spokesperson told CNBC this week. "The workers are angry. They want movement on attendance policies and not be afraid to take a sick day or vacation day without the fear of termination. There will be no ratification unless this is addressed."
Unlike the possible UPS strike, the potential railroad strike isn't about pay. According to NPR, workers are fed up with what they deem to be long shifts, numerous nights away from home, and "the need to be on-call, able to get to work in two hours or less, for weeks on end."
"I have never seen this level of anger," Dennis Pierce, president of the engineers' union, Brotherhood of Locomotive Engineers and Trainmen, told NPR. "They do not have days off. They do not have a schedule."
"We're not losing guys because of the money," one anonymous rail worker told NBC. "We're losing them because of the lifestyle. And we're not able to hire because of the on-call stuff."
The two unions holding out are scheduled to meet with Labor Secretary Martin Walsh today in Washington, according to CNN.
The interesting thing about a potential railroad strike is that the federal government has some power in preventing it. In July, President Biden appointed a group to help avert a strike and make recommendations for contracts that labor unions and railroads could agree on, thus preventing a strike for 60 days—a period ending on Friday, Sept. 16.
CNN reported that the White House is also working on contingency plans to keep the supply chain moving as negotiations stall.
"The White House is working with other modes of transportation (including shippers, truckers, air freight) to see how they can step in and keep goods moving in case of a rail shutdown," a White House staffer told CNN.
That is a lot easier said than done, though. It would reportedly take more than 460,000 additional long-haul trucks daily, which the American Trucking Association deemed "not possible based on equipment availability and an existing shortage of 80,000 drivers."
Should there be a railroad strike, it would affect things like gas prices, food, and the import of consumer goods as the busy holiday season starts to ramp up.
"The costs would grow geometrically the longer the strike lasts," Patrick Anderson, of Anderson Economic Group, told CNN. "After a week, you'd see real damage in the U.S. economy."
Should the unions and railroads miss that Friday deadline and a strike goes into effect, the next hope for the supply chain would be Congressional interference to end the lockout and get the trains moving again. But that's also not as easy as it sounds.
Congressional Republicans said they're working on legislation that would "impose a contract on the engineers and conductors unions to force them to stay on the job," per CNN.
"A rail worker strike would be catastrophic for America's transportation system and our already-stressed supply chain," said Sen. Richard Burr (R-NC), who plans to introduce the legislation with Sen. Roger Wicker (R-MS), according to CNN.
The railroads have said through the Association of American Railroads that engineers and conductors unions' demands should be dealt with on a local level rather than bargaining at a national level.
Democrats in Congress, however, are not as eager to introduce legislation to force the end of a strike. Sen. Richard Durbin (D-IL), told CNN that he doesn't believe Congress will intervene.
The unions contend that the railroads want Congressional intervention, as it allows the trains to keep moving without the workers receiving the demands they believe to be fair, and without adding new staff that union leadership says is necessary to alleviate the existing problems.
“The railroads are using shippers, consumers, and the supply chain of our nation as pawns in an effort to get our unions to cave into their contract demands knowing that our members would never accept them,” the unions’ presidents, Jeremy Ferguson of SMART-TD and Dennis Pierce of BLET, said in a joint statement to NBC.