THE PANDEMIC has been very good for cornflakes, and very busy for those who make them. With so many people spending so much time at home, cereal consumption has boomed. Kerry Williams, an instrument technician, says this has translated into almost constant overtime shifts at his Kellogg’s plant in Pennsylvania, sometimes as long as 16 hours a day. That would be hard enough. But what makes it that much harder, he says, is seeing Kellogg’s, one of the world’s biggest producers of ready-to-eat cereals, pull in giant profits even as his pay has barely increased. “We feel it’s time that this money trickles down to us because without the workers on the floor there would be no Kellogg,” he says. Mr Williams and about 1,400 colleagues at Kellogg’s factories around the country, from Tennessee to Michigan, have been on strike for two weeks.
They are far from alone. On October 14th about 10,000 employees of John Deere, a manufacturer of agricultural machinery, walked off the job in five states. More than 20,000 nurses and workers in California and Oregon with Kaiser Permanente, a health-care company, have voted to strike. Some 60,000 behind-the-scenes film and television workers were also set to head to picket lines, having voted 99% in favour of a strike, but a last-minute deal on October 16th averted that. Headline writers are referring to the wave of industrial action as “Striketober”.
Partly it is the resumption of trends visible before covid-19. Nearly half a million workers were involved in work stoppages in both 2018 and 2019, the most in more than three decades. That reflected both dissatisfaction with pay and working conditions as well as unions’ confidence that, in a tight labour market, they had leverage. The pandemic has only reinforced these dynamics. Having been lauded as essential workers for the past 18 months, everyone from nurses to food packers expects better treatment. And with companies struggling to find staff, workers are emboldened.
One of the dominant features of the American economic landscape over the past few decades has been sluggish wage growth for most workers. The question now is whether Striketober signals a turning-point, a shift in the balance of economic power towards labour. Workers have reason for guarded optimism, albeit from a low starting-point.
Labour’s share of non-farm output (the portion of economic output going to workers via wages and other forms of compensation) reached as high as 66% in 1960. At the end of 2019, on the eve of the pandemic, it was just about 59%, according to the Bureau of Labour Statistics. Even more notable has been the rise in inequality. Between 1979 and 2019 the top decile of wages in America rose by 41% in real terms, whereas the bottom decile increased by just 7%.
Multiple factors have weighed on blue-collar wages across the rich world. Advances in technology, including automation, have chipped away at workers’ bargaining power. So, too, has the globalisation of production. In America the weakness of organised labour has exacerbated these trends. Just one worker in ten belongs to a union today, half the proportion of the early 1980s.
Strikers seem to have the public on their side, at least for now. On a blustery autumn morning outside the Kellogg’s plant in Lancaster, a town in central Pennsylvania, a few dozen workers pace back and forth in front of the gates, maintaining a round-the-clock picket. Most passing cars honk their horns in solidarity. Opinion polls suggest that 68% of Americans support unions, up notably from a decade ago. “Everyone in this country is a little tired of the greed,” says Allan Torres, a middle-aged veteran of Kellogg’s packing operations.
The details of each dispute are different. The film and television workers complained about excessive hours. At Kellogg’s, workers object to aspects of a two-tiered system that lets managers bring in new staff on stingier packages. The company counters that it provides industry-leading pay and benefits.
Yet a common feature is the workers’ belief that they now have the upper hand. The strikers at Kellogg’s say the company has brought in buses with replacement staff to show that the factory can run without them. But, they say, the buses have been far from full. With just a light wisp of white smoke rising from the Lancaster plant, their assumption is that production has ground to a halt. “The grocery shelves aren’t going to be looking so good,” says Mr Torres.
Even without the strikes, there is no doubt that American workers are getting pickier. Nearly 4.3m quit their jobs in August, the most in the two decades or so that the Labour Department has monitored this data. Celine McNicholas of the Economic Policy Institute, a left-leaning think-tank, notes the exodus has been most pronounced in restaurants and retail operations, service sectors with few unions, low wages and little sick pay. “Folks are saying, ‘This is not a job worth it to me right now’,” she says. “They’re being asked to take it or leave it, and they’re leaving it.”
Labour organisers also know they have an ally in the White House. Joe Biden has repeatedly said that he aspires to be the most pro-union president in American history. Liz Shuler, president of the AFL-CIO, America’s largest federation of trade unions, has pointed to a friendly administration, worker activism and public backing as a potent combination. “We have everything lined up,” she said in a recent speech.
Not everything, though. “Labour laws have proven time and again to be completely stacked against workers who are interested in forming and joining unions,” says Kent Wong, director of the UCLA Labour Centre. Without legal changes that would, for example, prohibit companies from permanently replacing workers who walk off the job, the strike wave may fizzle out. The PRO Act, legislation that would strengthen collective-bargaining rights, has passed the House of Representatives. But it is almost certain to fail in the Senate without Republican support.
Some of the biggest American companies are waging their own battles against worker activism, and largely succeeding. An Amazon warehouse in Alabama was seen by labour organisers as their best shot at bringing unions to the e-commerce giant, but in April workers voted against unionising by more than two to one, amid allegations that the company had used intimidation tactics. Meanwhile, faced with a unionisation campaign in Buffalo, Starbucks has sent in out-of-state managers and closed outlets temporarily. It says this is part of its standard training procedures; labour organisers suspect it is trying to disrupt their efforts.
At the same time, companies are bowing to the reality that they have to offer higher wages to attract and retain workers. Amazon has increased its average starting hourly pay to $18 (from $17 earlier this year) for warehouse workers, well above the $15 that campaigners have long called for as a legal minimum. Walmart, McDonald’s and CVS, a pharmacy chain, are among the scores of others also raising pay, helping to fuel the biggest increases in blue-collar wages nationally in years.
At the Kellogg’s picket lines, the workers trumpet an old union mantra when asked how long they plan to stay off the job: “One day longer, one day stronger”. For American businesses, a different rhyming slogan can encapsulate their strategy in the face of Striketober: a few dollars higher, the union drive will expire.