As GM strike lingers, impact on local economy could grow

Members of United Auto Workers Local 2164 man the picket line Wednesday on Interstate Drive near the General Motors Corvette Assembly Plant.

Ron Butka came to Bowling Green last weekend to make sports cars. On Wednesday, the veteran General Motors employee was manning a picket line on Interstate Drive near the GM Corvette plant that has been silenced by a United Auto Workers strike now in its third week.

“I moved here last Saturday and went on strike on Sunday,” said Butka, who worked for 25 years at the GM plant in Lordstown, Ohio, before production at the plant that made the Chevrolet Cruze was cut earlier this year.

Butka took the $30,000 in transfer assistance and uprooted his life.

“I sold a house that we had hoped to have paid off in five years,” said Butka, 51. “My wife had to quit her job, too.”

Butka and other GM workers who transferred from Lordstown and other plants now classified as “unallocated” were supposed to be part of a 400-employee boost at the Corvette plant, where a second shift was scheduled to be added as the plant geared up to produce the eighth-generation Corvette.

Now, he has joined the 900 hourly workers at the Bowling Green plant and the nearly 50,000 GM workers nationwide who left assembly lines for picket lines Sept. 15, striking for better wages, better treatment of temporary workers, health insurance costs and other issues.

It’s a disruption that was on clear display Wednesday as striking workers carried signs and waved as passing motorists along the busy road honked in support.

The disruption, though, may be just beginning. As the longest UAW strike since the 67-day walkout of 1970 drags on, the impact on workers like Butka will grow, as will the blow to the local economy.

Striking workers are getting $250 per week from the UAW, a far cry from the $30 per hour or more that many veteran workers were making.

“It’s not going to be easy,” UAW Local 2164 President Jack Bowers said. “But most things worth fighting for are not easy.”

Bowers was referring to Corvette plant workers, particularly younger ones who may not have the savings of veteran workers, but he said the pain from the strike will quickly spread beyond the plant as those workers curb their spending.

“It’ll spiderweb out from here,” he said. “It will affect the local economy.”

Brian Strow, professor of economics at Western Kentucky University, confirmed that. “Each day that passes, the economic costs of the UAW strike compound,” he said. “With production coming to a halt, workers are not receiving wages, local governments are losing occupational tax revenue and stores and restaurants are losing business. The Bowling Green GM plant employs around 1,000 people. The consumer spending and taxes paid by these 1,000 households represents an important part of the local economy. The longer the strike continues, the more our community will suffer.”

Bowers and Strow also see an impact on other local manufacturers who supply raw materials to the Corvette plant. That trickle-down impact was demonstrated last year, when the Bowling Green Metalforming plant in the Kentucky Transpark was shut down for a few days after a fire at a parts supplier forced Ford Motor Co. to halt production at three truck assembly lines.

“If we don’t need the parts, they aren’t selling them to us,” Bowers said of the potential impact on suppliers.

Strow painted a bleak picture of the impact of an extended strike.

“A lingering strike will place increased pressure on automotive suppliers, which are in no short supply in southcentral Kentucky,” he said. “A prolonged strike may result in further plant closures, even less consumer spending and reduced tax revenues. It won’t be long before the whole local economy is touched by the production shutdown.”

Bowers and others on the strike’s front lines hope the work stoppage doesn’t last long enough to cause extreme damage.

As workers came in for meals and other assistance Wednesday at the Local 2164 headquarters on Plum Springs Loop, Bowers said he was encouraged both by the support for the strikers from groups such as Feeding America and the progress of the talks between UAW and GM negotiators in Detroit.

“GM came back with a proposal this week, and the union made a counter proposal,” Bowers said. “They’re discussing that now. That tells me that progress is being made. Concessions need to be made on both sides, but everyone needs to be treated fairly.”

Fairness is a big issue for picketers like Kyle Goins, an electrician at the Corvette plant. He has been putting in more than the required six hours per week on the picket line because he wants to show support for temporary workers who are at the heart of the negotiations.

Increased use of temporary workers who work for smaller salaries and don’t receive many of the benefits of their permanent co-workers was among the concessions the UAW made in a 2011 contract that came on the heels of GM’s bankruptcy and bailout by the federal government. But, with GM recording net income of nearly $8 billion last year, the automaker has clearly recovered from the 2009 bankruptcy.

“I’ve seen the hardships put on our younger workers, and it’s sad,” Goins said. “It really does bother me. I’ve worked side by side with several temporary workers who were brought in at the same time as I was. Those people are still on the line, doing the same job everybody else is doing, but they have no plan for when they’re going to be hired permanently.”

Goins said the 2011 contract’s concessions, including giving up a cost-of-living adjustment in pay, are no longer needed.

“It was a fair shake at the time,” Goins said of the 2011 contract. “We all agreed it was time to take concessions and try to help the company pull through that (bankruptcy).

“It’s definitely time for them (GM) to give back some of the things we gave up back then.”

– Follow business reporter Don Sergent on Twitter @BGDNbusiness or visit bgdailynews.com.

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(6) comments

Absolutely Positively

Re: temp workers



In 2011 the union members sold out those who are now temp workers in order to preserve their own benefits. They will do it again if that's what it takes to preserve their own once again.

BRains

Well said.

Enough Already

Don't blame GM.

The UAW and the strikers are responsible for any loss of economic benefit to the community. No one owes striking automakers a living a living.

If you don't like your job quit and find another one. That is how the other 99.9% of American workers deal with employment issues. You already make more and have better benefits than the vast majority of non-union workers but your greed demands more. You are not special but you are spoiled into thinking your entitled to something no one else gets. Go back to work or go bankrupt.

Ron B.

Yes we do make a good living with good benefits just like everyone should, we are willing to fight to keep our wages and benefits in order to protect them.

This is all about corporate greed, not just with G.M. but in corporations across the country, and it has to stop.

Companies need to start treat their employees as assests and NOT as liabilities.

Without the workers, companies wouldn't make these profits.

Everyone should be treated fairly in the workforce and it is worth fighting for!!

BRains

I agree 1000%. The UAW and the Teachers Unions should share the same bed. The Teachers Union members should pay for the UAW workers while they decide NOT TO WORK.

BRains

Nothing like a union mentality to think everyone deserves the golden goose. THEY DON'T. All the eastern folks who were out of jobs back in Ohio, New York, etc. due to their same union greed come to Kentucky to turn it into the same pee hole they made back east. Save your cry story. You are entitled to nothing in life.

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