Boeing Strike Agreement Reached

Appropriately topping the news today is the tentative agreement between the Machinists' union and Boeing Company. Here are some links: Seattle Times, Seattle PI, The News Tribune, Herald of Everett, and Puget Sound Business Journal.

The agreement most likely will bring to an end the 53 day strike. Like all strikes, this one has had costly consequences for the company and many striking workers. Both sides express support for the new contract and expect union members to ratify it in the coming week.

The PI's James Wallace links to the IAM site for contract details.

The four-year deal looks pretty good for the union. John Gillie summarizes neatly for The News Tribune.

The union reportedly got more of nearly everything in return for a longer period of labor peace, four years, instead of the three the union had originally considered.

Among the reported concessions, the company withdrew what the union had called?takeaways�� in the medical plan that in the original proposal would have added higher co-pays and fees to some of the medical plans it offers. The company also reportedly agreed to increase the pension formula from the $80 per year of service proposed in its September offer to $81 and then to $83 in the last year of the deal.

The previous proposal included a 11 percent pay increase over three years. The new deal reportedly includes a 15 percent increase over four years, but gives a higher increase, 5 percent, in the first year of the deal. In addition, the new agreement includes an enhanced?signing bonus�� of $5,000 for the first year and two $1,500 payments in subsequent years.

Here's Scott Carson's comment.

"This is an outstanding offer that rewards employees for their contributions to our success while preserving our ability to compete," Scott Carson, president and CEO of Boeing Commercial Airplanes, said in a statement. "We recognize the hardship a strike creates for everyone -- our customers, suppliers, employees, community and our company -- and we look forward to having our entire team back."

While the end of the strike is something to celebrate, no one should assume that it also marks an end to the region's competitive challenges. Boeing's future here hinges on more than simply putting the strike behind them, as analyst Richard Aboulafia points out in today's Times.

Earlier Monday, before news of the contract agreement, respected aerospace analyst Richard Aboulafia predicted the Machinists strike ultimately would drive Boeing from the state.

"Aviation centers are almost impossible to create, but they can easily be destroyed. I think Seattle will be the next to go," Aboulafia wrote in his monthly newsletter. "This strike, following myriad others and with little hope of improved relations, will almost certainly precipitate a (Boeing Commercial Airplanes) exit."

"Almost certainly" does not mean inevitably. But if Washington wants a strong aerospace cluster in its future - and the picture of this state without aerospace is a bleak one - policymakers have to act quickly.