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Big Three Prepare to Strike

2023 has been an intense year for union workers nationwide in many industries, from UPS workers to actors and writers.  With high inflation rates have come high demands during contract negotiations.  The buzz surrounding current talks between the UAW and the Big Three (GM, Ford, and Stellantis) has been no different.  As negotiations prolong and a contract expiration date of September 14 is looming, many UAW workers are having increased concern over the prospect of a lengthy strike. Although the UAW strike fund supplements a portion of workers' pay, a strike will leave many with a significant decrease in income for the duration of the strike.  When considering the possibility of being on strike, it is important to consider how to prepare your home to withstand a temporary drop in income.  

  1. Take advantage of overtime opportunities- It isn’t just UAW members who are feeling the stress of a possible strike. The Big Three are as well, so they are making efforts to cushion their inventory to sustain through a period without production, and most plants have increased opportunities to work overtime.  Making anywhere from 1.5-2 times your typical hourly wage, working overtime to set aside funds is a great way to prepare financially.  Of course, this may come at the cost of time with family or hobbies, but the upside of a strike is the opportunity to use your time more freely.

  2. Adjust your budget- For most of us, if we look at our budget and expenses with sober eyes, there are several areas where we can cut back.  Start by looking at your expenses now and prioritizing what is most important.  Committing to cooking at home, canceling certain streaming services, or getting creative with low-cost ways to entertain your family are great ways to close the gap between what you currently earn and what you will receive during a strike.

  3. Communicate with your spouse/family- Educate your family and prepare them for what might be coming. Often, it’s the unknown that causes us the most concern, so don’t keep those who are close to you in the dark.  Explain that you are all in this together, that this is temporary, and celebrate the upside of having extra time together during the strike period.

  4. Know that relief is coming- It is typical for the UAW and the Big Three to come to an agreement at the end of a strike period to distribute a lump sum ratification bonus.  In 2019, after a 40-day strike, workers received a $11,000 ratification bonus.  Although this bonus is not guaranteed, history shows a pattern that it is more than likely.

As the spouse of an hourly GM worker, I can relate to and understand the stress that comes with the uncertainty of a strike.  If we aren’t intentional when working in the manufacturing industry, we are in danger of constantly focusing on the downsides.  Instead, our family has found it helpful to celebrate the positives.  When mandatory overtime infringes upon our plans, we choose to celebrate the blessing of the extra income.  When layoffs or strikes come, rather than worrying about the loss of income; we choose to rely on the likelihood that profit sharing, overtime, or a ratification bonus are around the corner and simply enjoy the extra time that we have with our family.

Is a strike between UAW and the Big Three certain?  At this point, it is too early to tell, but it is never too early to prepare.

Written by: Brittany Culver

This commentary on this website reflects the personal opinions, viewpoints, and analyses of the Financial Strategies Group, Inc employees providing such comments, and should not be regarded as a description of advisory services provided by Financial Strategies Group, Inc or performance returns of any Financial Strategies Group, Inc Investments client. The views reflected in the commentary are subject to change at any time without notice. Nothing on this website constitutes investment advice, performance data, or any recommendation that any particular security, portfolio of securities, transaction, or investment strategy is suitable for any specific person. Any mention of a particular security and related performance data is not a recommendation to buy or sell that security. Financial Strategies Group, Inc manages its clients’ accounts using a variety of investment techniques and strategies, which are not necessarily discussed in the commentary. Investments in securities involve the risk of loss. Past performance is no guarantee of future results.

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