The United Auto Workers strike came to an end as the union struck its last tentative deal with Big Three automaker holdout General Motors and secured increased pay and better benefits for union employees.
It took six weeks of striking for the union to complete tentative agreements with automakers Ford, General Motors, and Stellantis, the parent company of Fiat Chrysler. All that’s left is for union membership to put pen to paper and ratify those deals to fully enact them.
If workers aren’t on board, they can send their representatives back to rev up negotiations once again.
Each of the deals mirrors each other for the most part: a 25 percent wage increase for all workers, cost of living increases, and increases to retirement contributions. Under GM’s deal, employees will receive an immediate pay raise of 11 percent upon ratification. The agreement also sets top pay at more than $42 an hour and puts an end to a controversial two-tier pay system. Veteran workers will also see a 33 percent wage increase.
So what does all this mean for Black workers?
While the Big 3 have plants and factories across the country, Michigan is the heart of America’s automotive industry. Several Big Three plants, including original equipment manufacturers (OEM), operate out of Detroit and Flint, Michigan.
According to a 2021 automobility report from the Detroit Regional Chamber, 21 percent of the automotive manufacturing industry’s workers in Michigan are Black.
For the most part, factory workers are not salaried but work for hourly pay. Data from the Bureau of Labor Statistics shows that U.S. autoworkers on manufacturing production lines earn about $28 an hour. There was also a two-tier system that automakers implemented in which workers hired in 2007 and earlier were paid more — about $33 an hour — than workers hired after 2007.
In any case, earning less than $30 an hour is less than ideal for workers who have households of their own to manage. That’s why the cost of living increases was a major union priority when striking these new deals. With inflation surging over the past few years, families who were considered middle class in 2020 may no longer fall into that income bracket.
According to the Pew Research Center, the share of adults in the U.S. who live in middle-class households fell from 61 percent in 1971 to 50 percent in 2021.
A SmartAsset analysis revealed that in Michigan, the median household income is $63,498, but to be considered middle class, residents must make between $42,544 and $126,996. In 2023, if you work in Detroit and are providing for a family of four, your household income must bring in $64,130 to be considered middle-class.
The two-tiered wage system made it impossible for many people who weren’t legacy workers to make those middle-class household incomes. Now that it’s being phased out, the new pay adjustments make it possible for all union workers to make enough to reach middle-class standing.
While the strikes have been called off, there’s no word yet on when employees will return to work.
The strikes cost the Detroit Three and suppliers billions of dollars after about 50,000 UAW workers started walkouts the week of Sept. 15. The new contracts will significantly raise costs for the automakers. Some analysts surmise that the deals will make it harder for the Detroit Three to compete with electric-vehicle leader Tesla and nonunion foreign brands such as Toyota Motor.
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