Advertisement
11/21/2022

NRF: Rail strike would be ‘devastating’ for businesses, consumers, economy

Marianne Wilson
Editor-in-Chief
Marianne Wilson profile picture
Image
railroad union  strike
A nationwide rail shutdown could halt nearly 7,000 freight trains and cost more than $2 billion a day.

With the risk of a national freight rail strike increasing, the National Retail Federation wants Congress to take action.

On Monday, members of the nation’s largest rail union, which represents about 28,000 conductors, rejected — by a very slim margin — a tentative contract agreement with freight rail management that had been brokered by the White House among the labor unions and freight railroads. The vote raises the possibility of a strike in the coming weeks that could seriously damage the U.S. economy.

Also on Monday, the second-largest rail union, made up of engineers, voted in favor of the contract, splitting the top rail unions, which represent approximately half of the industry's workers. The two votes came about a month after the nation's third-largest rail union rejected the contract.

Eight of the 12 unions have ratified the agreement, while four have rejected it. If even one of the 12 railroad unions were to go on strike, however, the others would honor the picket lines, shutting down the railroads. The unions could strike on Dec. 9.

According to a report from the Association of American Railroads, which represents major carriers, a nationwide rail shutdown could halt nearly 7,000 freight trains and cost more than $2 billion a day. Freight railroads are responsible for carrying 40% of the nation's long-haul freight.

“A rail strike will create greater inflationary pressures and will threaten business resiliency”
-- NRF president and CEO Matthew Shay

In a statement, AAP president and CEO Ian Jefferies noted that “the majority of the unions “have approved the largest wage increases in nearly five decades and also paved a path toward greater scheduling predictability” for union members.

“Railroads stand ready to reach new deals…but the window continues to narrow as deadlines rapidly approach,” Jefferies said. “Let’s be clear, if the remaining unions do not accept an agreement, Congress should be prepared to act and avoid a disastrous $2 billion a day hit to our economy.”

NRF president and CEO Matthew Shay said 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.

Shay added that ‘smooth and stable operations” on the rails is absolutely crucial this holiday season and should not be derailed by a rejection of the contract. “The parties must work out the issues and ratify the contract without a disruption to the system,” he said. “if not, Congress must step in to prevent a strike before the end of the cooling off period on Dec. 8.”