Amazon, Starbucks, rail freight… The slow awakening of American unionism

A strange awakening is happening on the other side of the Atlantic. Since this summer, American railway companies and labor organizations have been engaged in a showdown over the working conditions and wages of tens of thousands of train drivers, machinists, mechanics and other rail employees. On September 15, just hours before negotiations closed, stakeholders agreed to individual bonuses of $5,000 and a 24% wage increase. A third of American goods and exports are transported by rail. In the event of a strike, the entire economy would have been shaken, at a cost of around two billion dollars a day. This disaster scenario avoided, the dozen unions involved in the negotiations must now submit the agreement to the vote of their members.

The spectacular concessions obtained by the rail unions are not an isolated fact. Last December, 27 employees of a Starbucks coffee shop in the city of Buffalo voted to unionize their establishment, a first in the company’s history. In the spring, it was the turn of 8,000 Amazon employees in Staten Island, a southern district of New York City, to unionize the first warehouse of the e-commerce giant. At the same time, strikes lasting several weeks forced Deere, a famous agricultural equipment manufacturer, and the agri-food company Kellogg’s to concede wage increases. In short, for the past few months, American unions have been on the rise.

These recent victories are all the more striking given that, at the end of 2021, only 10% of American employees were unionized. Not since the 1930s has this share been so low. After the Wagner Act of 1935, which ratified the rights of unions to strike and engage in collective bargaining, unionization had increased sharply, reaching one-third of employees in 1968. During these decades, unions defended with success the interests of low-income workers: a recent study shows that the increase in the rate of unionization will have largely contributed to reducing inequalities during this period, the share of income going to the 10% of the best paid employees falling by almost a third (from 48% to 34%) between 1935 and the end of the 1960s. Since then, the weakening of the unions has been accompanied by an explosion of inequalities.

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Inequalities and unionism

Are we today at the dawn of a new era? Is the September 15 agreement the harbinger of a new golden age for American trade unionism and a rebalancing of the distribution of wealth?

Apparently, the political context is favorable. Public approval of trade unions, which has been rising steadily since 2008, now stands at 68%. During the 2020 presidential campaign, Joe Biden promised he would be the “most pro-union president ever”. On September 5, “Labour Day” in the United States, he reaffirmed his support for the unions, and a few weeks later he personally worked on the agreement reached in the rail sector.

Biden’s fuzzy promises

The fact remains that this intervention is undoubtedly partly explained by a short-term political calculation: the fear that a paralysis of the transport of goods a few weeks before the elections of November 8 will turn against the Democrats. Beyond the support expressed by Biden for a few specific union actions, his campaign promises remain a dead letter for the moment, whether it is the increase in the federal minimum wage (by only $ 7.25) or the adoption of a law guaranteeing trade unions the right to collect dues from all employees of the companies in which they are active.

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Above all, the current bargaining power of American employees is largely explained by the low unemployment rate, below 4%. Companies are indeed more inclined to increase wages when they know that their employees are difficult to replace. But unemployment could rise again in the coming months, with the slowdown in economic growth and the successive tightening of interest rates by the central bank. If the rail unions have been able to take advantage of the proximity of the mid-term elections to win a historic victory, the Grand Soir still seems a long way off.



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