A nationwide freight rail strike would have cost the economy an estimated $ 2 billion a day.
A strike that would have halted nearly 7,000 freight trains and dealt a blow to the nation’s supply chain heading into the holidays has been averted.
President Joe Biden signed legislation Friday to impose a labor agreement between rail companies and workers, averting a strike that he had said would “devastate” the U.S. economy. It’s estimated that the strike would have cost the economy an estimated $2 billion a day.
"We've spared the country that catastrophe," Biden said during the signing ceremony at the White House. "I know this was a tough vote for members of both parties. It was tough for me. But it was the right thing to do at the moment."
In remarks prior to signing the bill, Biden noted that without freight rail “many U.S. industries would literally shut down.” He also said that his economic advisors told him as many as 765,000 Americans, “many of them union members themselves,” would have lost their jobs.
The signing came just days after, in a rare bipartisan vote, Congress approved a bill that would force the rail companies and employees to abide by a tentative agreement that the Biden administration helped to broker earlier this year. Four of the 12 unions representing rail workers had rejected the deal, setting the stage for a strike that would have begun Dec. 9, primarily because it did not include their demand for guaranteed paid sick leave days.
The agreement approved by the House and Senate and signed by Biden gives workers a 24% raise over five years, caps on health care premiums and one additional personal day.
The Senate followed Congress in approving the bill. But it did not approve a House-passed measure to add seven days of paid sick leave to the agreement.
“Look, I know this bill doesn’t have paid sick leave that these rail workers and frankly every worker in America deserves,” Biden said. “But that fight isn’t over. "I've supported paid sick leave for a long time. I'm going to continue that fight 'til we succeed."
NRF president and CEO Matthew Shay had said in November that a nationwide rail strike during the peak holiday season will be “devastating” for American businesses, consumers and the U.S. economy — particularly amid today’s increased prices due to persistent inflation.
“A rail strike will create greater inflationary pressures and will threaten business resiliency,” he said. “Congress must intervene immediately to avoid a rail strike and a catastrophic shutdown of the freight rail system.
It was the first time since the 1990s that Congress has used its power under the nearly 100-year-old Railway Labor Act to intervene in a national rail labor dispute, reported the New York Times. But the threat of economic damage as the holidays approach, along with President Biden’s personal appeal for Congress to act, appeared to have provided the momentum necessary to propel the measure with “unusual speed,” the report said.