The ongoing strike by Boeing's union machinists could end this week, but not before racking up more economic damage than any other work stoppage in the U.S. so far this year, according to estimates.

Boeing and the union, the International Association of Machinists and Aerospace Workers Local 751, reached a tentative agreement Saturday. The striking workers will vote Wednesday on whether to take the latest offer, which includes a 35% pay hike over four years, a new incentive plan and a $7,000 ratification bonus.

But even if the workers agree to accept the deal – which is not guaranteed – the impact could extend far beyond its current price tag, according to Anderson Economic Group (AEG) principal and CEO Patrick Anderson.

"If they ratify the contract and get back to work by Friday, the IAM strike against Boeing would be the costliest strike yet in the contentious year of 2024," Anderson said.

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AEG, which specializes in economic impact estimates, figured the cost of the Boeing strike at $7.6 billion through last Friday, and Anderson said adding another week to that total will push the cost well above $8 billion.

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The Teamsters' threat to strike against UPS would have been a greater strike in terms of workers walking off the job, Anderson noted, but that strike was averted after a deal was reached. 

The union dockworkers' strike launched at the beginning of October that lasted three days "were barely palpable outside port cities," Anderson said, adding that "By our estimate, a one or two-week port strike would have had a smaller impact than the IAM strike against Boeing already has."

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Anderson noted that the Boeing strike's impact has extended over the weeks to beyond the company's picketing workers, to hit its managers and engineers, suppliers and other business in the Seattle area.

Since the strike began in mid-September, Boeing imposed furloughs before announcing earlier this month it would lay off 10% of its workforce, impacting some 17,000 people, and cut production in reaction to the strike, which involves 33,000 employees.

"The Boeing strike has not only been costly; it has affected the standing of one of the largest exporters in the US economy, and an icon of American manufacturing prowess," Anderson said. 

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He added, "It has already forced the company to push back promised shipments of airframes, and could have long-term effects that are even more costly than the $8 billion that would already been lost by its workers, shareholders and suppliers even if the strike ends next week. "

Reuters contributed to this report.

Original article source: Boeing strike costliest in economic damage so far in 2024