Our story starts in a striking General Motors factory. The year, though, is 1936.
Like now, workers used a new strategy.
UAW Strikes
The 1936-1937 UAW Strike
According to mid-1930s U.S. government statistics, at $900, average auto workers earned $700 less per month than they needed to support a family of four. Then, adding to inadequate pay, there were hundreds of worker deaths during a 1936 summer heat wave. But still, it took the firing of three workers that participated in “a quickie sit-down strike” to galvanize union support (where there had been almost none). The synergy of inadequate pay, unsafe working conditions, and the firing led to a December 30 sit-down strike at Body Plant Number One in Flint, Michigan. By February 1, 1937, workers occupied GM’s largest factory, Chevy Plant Number Four.
Considered revolutionary, having moved into the workplace, strikers not only prevented management from hiring replacements but also minimized their weather and violence worries. Meanwhile, their families supplied their daily needs. One of many stories, a woman tells how she got a basket of food to her new husband on New Year’s Eve:
“I had known one of the security guards from school so I kept him occupied while Al dropped a rope down from the second floor,” she said. “I ran and tied the basket on that.”
At Fisher Body Plant Number Three, these strikers appear to be relaxing during their sit-down strike:
After 44 days, and an intervention from President Roosevelt, on February 11, the strike ended. GM agreed to a $25 million wage increase, and to recognize the union and workers’ right to join it. Spreading to other auto firms, at 300 percent, the wage increases were dramatic. So too was the surge in union membership from 30,000 to 500,000.
The 2023 UAW Strike
At 11;59 on September 14, today’s UAW strike began. Their issues include wages, benefits, and the workweek. More precisely, among their goals, they list a 36 percent wage hike during the next four years and ending the tiered pay differential between new and existing employees. They are also looking for new retiree benefits, a 32-hour workweek with 40 hours of pay, and job security as plants transition to EVs. In addition, they want to represent workers at 10 soon-to-be-built EV factories.
As for strategy, somewhat like 1937, only some plants have been targeted. Having started at three assembly plants after their contract expired on September 14, now they’ve expanded the strike to 38 locations in 20 states:
Our Bottom Line: Structural Change
Characterized by new land, labor, and capital, the switch to EVs represents a structural transition in the economy. Like the bowling alleys that used to need pinsetters and the typewriters we wrote with, the auto industry’s factors of production are again changing.
Described by Joseph Schumpeter as creative destruction, the change is painful. From the auto worker’s perspective, their livelihood will evaporate. At the same time, management has to plan for a slew of new jobs that will prevent the world’s Teslas from hijacking the future. As economists, we call it structural change. Referring to new factors of production, structural change transforms our labor and our capital. It requires new skills and new technology.
I guess we could say that structural change led to the auto industry’s first big strike. Then, workers sought a role in an ascending industry. Now, in a reverse circumstance, we have workers trying to retain power during a decline. The common theme is structural change.
My sources and more: Building from our UPS strike post, comparing UAW strikes, I checked the facts from the 1930s here and here. Meanwhile, this AP article summarized the current UAW goals. In addition, for more on creative destruction, do take a look at econlib. And finally, for a bit of frivolity, you might enjoy this Mental Floss list of the professions that disappeared and our econlife post on Knocker Uppers..
