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Economic impact from freight rail strike in the USA could total $2B per dayFriday, September 9, 2022
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Dear Customer,
Please note that this advisory is excerpted from an article published by Freightwaves on September 8, 2022.
Rail stakeholders in the USA are concerned that a possible strike by some union members due to stalled contract negotiations could result in multibillion dollar economic impacts. The Association of American Railroads estimates that a nationwide shutdown of rail operations could cost $2 billion in lost economic output each day.
A new labor deal for union members has been in the works since January 2020, but negotiations between the unions and the railroads had failed to progress. A federal mediation board took up the negotiations but released the parties from those efforts earlier this summer.
The Presidential Emergency Board (PEB) — a three-person board appointed by President Joe Biden that convened in July and August to come up with ways that the unions and railroads could resolve their negotiations impasse — issued recommendations last month that sought to resolve the impasse in negotiations. The recommendations were meant to serve as a jumping off point for a new contract. As of Thursday, more than a half-dozen unions still need to reach an agreement with U.S. freight railroads over a new contract. While five unions have reached an agreement and have sent that agreement to their members for ratification, some of the larger unions, such as the Brotherhood of Locomotive Engineers and Trainmen and the International Association of Sheet Metal, Air, Rail and Transportation Workers – Transportation Division, also known as SMART-TD, have yet to reach an agreement with the railroads.
Per the Railway Labor Act, both sides have until midnight on Sept. 16 to come to a consensus; after that, the “cooling-off” period ends, and union members could decide to go on strike.
We continue to monitor the situation and will provide further updates as they are received.
Sincerely,
HENSALL GLOBAL LOGISTICS |
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