Why ‘fed up’ actors, writers, hotel workers and grad students are all on strike

At the end of the month, hundreds of thousands of UPS workers across the country could be next to walk off their jobs. Graduate-student workers at universities all over the U.S. — including the University of California, Temple University and the University of Michigan — have either gone on strike or voted to unionize in the past several months. Doctors at Stanford Health Care in California are planning a rally Wednesday over wage concerns. And United Auto Workers’ contracts expire in September, which could mean a strike of nearly 150,000 auto workers against the Detroit area’s Big Three automakers — Ford
F,
Stellantis
STLA
and General Motors
GM
— if bargaining talks fail.

Each group of workers taking action has its own unique set of circumstances, but labor experts and economists say most of them have something in common: They’re frustrated because their wages have stayed relatively stagnant, while their employers have raked in increased income over the past few years — or longer. The coronavirus pandemic brought those disparities to the fore; meanwhile, the cost of living continues to rise, and workers are feeling emboldened as they see other workers unionizing or striking.

From the archives (August 2022): Opinion: Inflation has been very good for corporate profits

The current wave of strikes, dubbed “hot labor summer” by some people on social media, was decades in the making. U.S. employers began to use the country’s labor laws to their advantage in the 1970s as they pushed back against unionization efforts — using anti-union consultants, employing replacement workers during strikes, threatening plant closures and more. Their actions, along with court rulings favorable to them, led to steep declines in union membership starting in the ’70s.

In recent years, workers’ discontent has grown. There were 23 major work stoppages begun in 2022, higher than the average of 16 work stoppages in each of the previous 20 years, according to the Bureau of Labor Statistics. The most recent BLS data also shows that union membership in 2022 increased 1.9% from the previous year, but because the number of workers in the workforce increased nearly 4%, the unionization rate fell to 10.1%, the lowest on record.

A 2021 Gallup poll found that public support for unions stood at 68%, a 56-year high.

‘Exorbitant and rising inequality’

Wages have stagnated, while the cost of living has risen substantially, noted Nicole Smith, a research professor and chief economist at the Georgetown University Center on Education and the Workforce. Smith cited Federal Reserve Bank of St. Louis and Bureau of Labor Statistics data from the past 50 years, when average real hourly earnings — meaning hourly wages adjusted for inflation — went from $28.36 to $29.50. 

“Of course, there’s a lot of movement in between — but that’s pretty flat, if you ask me,” Smith said.

The rising cost of living, exacerbated by the pandemic’s economic impacts, has hit most people across all facets of the economy, Smith said. “With the supply-chain bottlenecks came a lot of inflation,” she said. “When the bottlenecks cleared up, there was no real incentive for companies to push prices back down.”

Related: See how much inflation has raised your cost of living, using MarketWatch’s guide

Historically, prices don’t come back down after they’ve gone up, she added, so many companies are bringing in more money. But wages aren’t necessarily keeping up.

“You see this at company after company,” said Erik Loomis, a historian and associate professor at the University of Rhode Island who has authored books on the labor movement. “The culture of the quarterly report [to shareholders] is a huge part of this,” he added, because shareholders want to see revenue growth at all costs.

For example, Loomis said, considering their wages and working conditions, “being a UPS driver is not that great of a job anymore, while UPS makes record profits.”

That’s in line with what the Teamsters are saying after negotiations with UPS
UPS
failed and the drivers’ contracts expired in June: that drivers want their fair share after the pandemic, and the general rise in demand for shipping services was a boon for companies like UPS. The delivery giant reached $100 billion in revenue for the first time last year, and reported a record $11.3 billion annual profit.

UPS has said that it is “proud” of what it has offered in negotiations, and wants the union to return to the bargaining table.

Todd Vachon, an assistant professor and director of the Labor Education Action Research Network at Rutgers University, agreed that Wall Street demands are a huge factor in the labor strife.

“There’s a general sense of frustration about the exorbitant and rising inequality in our society that’s on display every day,” Vachon said. “Publicly traded companies are buying up more of the economy, and there’s an emphasis on quarterly returns.” He added that companies are constantly asking themselves, “How can they get more profit three months from now than they did today?”

Again, UPS provides an example of the priorities of what Vachon calls “the shareholder economy”: The company now says the growth in demand fueled by the pandemic has slowed, which has weighed down its stock.

Similarly, hotel companies took a big hit from the pandemic, which halted travel in 2020. Now that most travel except for business travel has recovered, many hotel operators — such as Hilton
HLT,
Marriott
MAR,
InterContinental Hotels Group
IHG
and Hyatt
H
— are reporting higher gross margins, or profit after subtracting the cost of goods, than before the pandemic.

Unite Here Local 11, which represents thousands of Los Angeles-area hotel workers, has pointed out that hotels received government bailouts at the beginning of the pandemic. The union said the hotels cut jobs and guest services, but now that hotels’ business has rebounded, their workers continue to struggle. That’s especially true in a place like Los Angeles, where housing costs are among the highest in the country, they say.

For their part, the hotels that haven’t reached a bargaining agreement with the workers say they’ve put forth a “meaningful” offer on wages, and want to reach an agreement.

From the archives (May 2023): Hotel housekeeping jobs have fallen by 102,000 during the pandemic

In the entertainment business, the picture is mixed. While streaming giants such as Netflix
NFLX,
 Amazon
AMZN
and Apple
AAPL
also had higher gross margins last year compared to 2019 or pre-pandemic, that was not the case for some of the major studios, such as Disney
DIS,
Warner Bros.
WBD
and Paramount Global
PARA.
Yet most of the companies are profitable.

Aside from wages and benefits, the issues the writers and actors are striking over include changes brought on by technology, such as streaming residuals and the threat artificial intelligence potentially poses to their work.

When the actors joined the writers on strike last week, the Alliance of Motion Picture and Television Producers said the move would “lead to financial hardship for countless thousands.” The trade association, which represents the studios and streaming companies, added this week that “a strike is not the outcome we wanted.”

Read more: SAG president Fran Drescher hits back at Disney CEO Bob Iger’s strike comments

‘Strikes beget strikes’

The bottom line: Workers are “fed up,” said Ken Jacobs, chair of the UC Berkeley Center for Labor Research and Education. “The broad through line is that the wealth that’s being generated is equitably shared with those who are doing the work that creates it,” he added.

Additionally, “seeing other workers in motion, taking action and organizing and striking, also builds confidence” for workers to do the same, Jacobs said.

Loomis, of the University of Rhode Island, agreed: “Strikes beget strikes,” he said.

Success for any of the high-profile strikes could add fuel to some of the newer unionization movements that have so far stalled out, labor experts say, such as the organizing pushes at Amazon or Starbucks
SBUX,
which have yet to yield any contract agreements.

Laura Boudreau, a Columbia Business School professor, said it’s possible that any big strike victories could give a boost to newer labor efforts, “but it’s not a given.”

Sure, she said, there is “increased media attention and public support” of unions and striking workers — “but the fledgling unions still face uphill battles.”

From the archives (May 2023): Are Hollywood writing jobs the next frontier for gig work? Here’s what a striking writer says.

From the archives (April 2022): Unions’ push at Amazon, Apple and Starbucks could be ‘most significant moment in the American labor movement’ in decades