Boeing machinists on strike: "I can endure as long as necessary"

• Boeing machinists on strike have saved money and plan to find temporary jobs to sustain themselves.
• Nearly 95% of Boeing machinists voted to reject a tentative contract on Sept. 13, resulting in more than 30,000 workers walking off the job.
• According to Bank of America estimates, the halt in Boeing's aircraft production due to the strike is costing the company $50 million a day.

RENTON, Wash. — The ongoing machinist strike is putting cash-strapped under mounting costs as workers push for higher pay. Failing to reach a deal could result in even greater expenses.

Boeing machinists in Seattle are considering taking on side jobs in landscaping, furniture moving, or warehouse work to make ends meet if the strike continues.

The ongoing work stoppage by Boeing's factory workers in the Pacific Northwest has now been going on for two weeks. The financial impact of the strike on Boeing will depend on its duration, with ratings agencies cautioning that the company could face a downgrade if it continues for an extended period.

The near-catastrophic door plug blowout from one of Boeing's 737 Max planes in January has caused the company to burn through about $8 billion in debt, adding to its already $60 billion debt.

Since 2018, Boeing has not earned an annual profit, and its new CEO, Kelly Ortberg, is working to repair the company's image after a series of manufacturing problems that have slowed production and reduced revenue.

Jake Meyer, a Boeing mechanic, said he can't afford to own a home and will start driving for a food delivery service during the strike. He also plans to pick up odd jobs such as moving furniture. Although he's striking for higher pay from Boeing, he enjoys the job of building airplanes.

"I take pride in my work," he said.

A Boeing machinist stated that he has been saving for months, giving up on dining out and paying three months' worth of mortgage payments in advance.

The worker stated that they could endure for as long as necessary, on the condition of remaining anonymous.

$50 million a day

Nearly 95% of Boeing machinists voted in favor of a strike after turning down a tentative labor deal, and they received their last paychecks on Thursday. Their health benefits will end on Sept. 30, but a strike fund from the union will soon provide them with $250 a week.

According to Bank of America aerospace analyst Ron Epstein, the strike is estimated to cost Boeing $50 million a day. The halt in production of most of Boeing's aircraft has caused a ripple effect throughout the aerospace giant's extensive supply chain, with some suppliers already instructed to halt shipments. Despite this, Boeing is still producing 787 Dreamliners at its non-union factory in South Carolina.

The conflict involves a struggling Boeing facing a workforce demanding higher wages and better working conditions. Boeing's latest proposal included a 25% increase in general wages over a four-year period, which was approved by the International Association of Machinists and Aerospace Workers District 751 union.

The union had proposed wage increases of 40%, and workers said they were seeking this amount, along with annual bonuses and the restoration of pensions lost more than a decade ago.

This week, Boeing and the union were at the negotiation table, but both parties expressed disappointment over the slow pace of negotiations.

"Union negotiators wrote to members Wednesday, expressing their concern that the company has not addressed their top concerns despite continuing to prioritize the issues defined in the most recent survey. No meaningful progress was made during today's talks."

Boeing announced temporary furloughs for tens of thousands of staff, including managers and executives, just six weeks after Ortberg started his job, following a hiring freeze and other cost-cutting measures.

Ortberg stated in a note to staff on Friday that during the mediation with the union this week, we continued our good faith efforts to involve the union's bargaining committee in productive negotiations to address the feedback we've received from our team.

Although the talks did not result in more advancements, we are highly dedicated to achieving a prompt agreement that acknowledges our employees' efforts and ends the strike in the Pacific Northwest, as stated by Ortberg.

In recent years, labor battles have escalated, with actors, autoworkers, port workers, and airline employees all winning raises after strikes or strike threats. The latest conflict involves Boeing machinists in the Seattle area, Oregon, and a few other locations.

The Biden administration has encouraged Boeing and the union to reach a deal.

On Thursday, Transportation Secretary Pete Buttigieg stated on CNBC's "Squawk Box" that he believes both parties desire a resolution that benefits the workers and the company, which is crucial for the company to move forward on multiple fronts.

Tight labor market

The 2008 strike, which lasted less than two months, occurred when Boeing was in better financial shape and there was less job competition in the area.

One Boeing supplier stated to CNBC that laying off or furloughing workers would result in issues for several months due to the extensive and intricate training required for such technical work.

"According to Bank of America's Epstein, the current job market is competitive, particularly in aerospace and defense, where skilled, technical labor is in high demand. To retain and attract talent, companies need to offer competitive advantages, such as pensions."