Businessweek Archives

Union Workers Will Get Some Breaks In '92


The Workplace

UNION WORKERS WILL GET SOME BREAKS IN '92

For most workers, recessions are the worst of all worlds. Layoffs increase, new jobs dry up, and employers become tightfisted with pay. Since many economists, even optimists, expect sluggish growth at best in 1992, the outlook for unionized workers would logically seem to be as grim as for everyone else. But the year may not be so bad for the 3 million or so union members whose contracts will expire.

True, some remain vulnerable to layoffs. But the rest may win wage increases that come closer to the anticipated rise in inflation than at any time in nearly a decade. A Conference Board panel of labor experts predicts that pay raises for union members will average 3.4% in 1992, while inflation will come in at 3.5%. Employers say the same thing: Some 85% of those bargaining in 1992 plan pay hikes that approximate or exceed inflation, according to a survey by the Bureau of National Affairs, a private company based in Washington.

`LITTLE PRESSURE.' The reason: a combination of low inflation and rising productivity. In manufacturing, where unions are concentrated, productivity is rising nearly as fast as wages. So, increases in labor costs per unit of output "are almost zero," says David Lewin, a professor of industrial relations at the University of California at Los Angeles, and "there's little pressure on employers."

In fact, in relative terms, union workers have begun to fare better than they did during the 1980s. Their wage increases have averaged 3.7% since April, 1990, according to the Bureau of Labor Statistics. During this period, organized workers did as well as nonunion ones for the first time since 1983.

They're even doing a bit better if benefits are included: Union members got a 4.8% increase in total compensation in the 12 months ended in September, vs. 4.3% for nonunion workers. Union contracts are more likely to provide health insurance, whose costs have outpaced inflation. That promises to cause friction this year, however, since 70% of union employers plan to rein in medical costs, according to the BNA survey.

Of course, there will be some battles over pay. The 74,000-member Screen Actors Guild (SAG) is likely to demand at least a modest increase in its $448-a-day minimum. But box-office results have declined for two straight years, and video and cable sales are lackluster. So TV and movie producers are in no mood to give much. Already, the studios are playing hardball by insisting that all production be wrapped up before SAG's contract expires on June 30. For instance, Disney won't start any films after Apr. 1. This could affect films such as The Distinguished Gentleman, starring Eddie Murphy, which is due to start shooting in mid-March. Much of a delay could put that film on hold.

PHONE TROUBLE. Jobs will be the flashpoint in one of the few large union contracts expiring this year. American Telephone & Telegraph Co.'s relations with its two unions have frayed badly in recent years, primarily over layoffs. As the company has streamlined its core manufacturing business, its unionized employment has fallen from 240,000 in 1984 to 132,000 today. Meanwhile, new technology and acquisitions have swelled AT&T's white-collar ranks by some 7,000, to 118,000. The purchase of NCR Corp., which has only about 1,300 union members out of 27,000 U. S. employees, puts organized employees in the minority for the first time.

This situation, among others, could lead to a strike. The Communications Workers of America (CWA) is demanding that AT&T remain neutral in organizing drives. And last year, AT&T Chairman Robert E. Allen and CWA President Morton Bahr set up a union-management committee to hammer out rules for AT&T to follow during organizing drives. But extending this approach to NCR, as the CWA wants to do, is another matter. Already, the computer company is actively opposing the CWA in an organizing election set for NCR field-service engineers in Dayton. "It doesn't make sense to have a union in a nonunion industry," says William W. Holloway, NCR's vice-president for personnel.

Except for such disputes, 1992 could be a calm bargaining year. Union workers who survive layoffs may keep pace with inflation. And for them, that's the best news in a long, long time.LABOR'S 1992

BARGAINING CALENDAR

Employers Contract Number of

expiration workers

RETAIL FOOD February-October 73,000

AEROSPACE April 61,000

ALUMINUM May 21,000

AT&T May 100,000

HOLLYWOOD June 109,000

CONSTRUCTION June-December 103,000

BELL COMPANIES August 320,000

DATA: BUREAU OF NATIONAL AFFAIRS INC.

Aaron Bernstein in New York, with Ronald Grover in Los Angeles


Tim Cook's Reboot
LIMITED-TIME OFFER SUBSCRIBE NOW
 
blog comments powered by Disqus