Boeing averts strike as workers approve 32% pay hike
What's the story
Boeing has successfully averted a potential labor disruption after its unionized white-collar workers ratified a new contract. The Society of Professional Engineering Employees in Aerospace (SPEEA), which represents Boeing engineers, scientists, technicians, and pilots, announced that the majority of its members have approved the negotiated proposal. The professional unit, which includes some 13,000 engineers and scientists, voted "yes" by 67.6%. Meanwhile, the tech unit, with over 4,000 analysts and technicians, voted in favor by 53.5%.
Contract details
The deal also includes an immediate pay raise of 10%
The new contract promises an average pay increase of 32% over four years for SPEEA-represented workers. This is about 5% more than the earlier rejected offer.
The deal also includes an immediate pay raise of 10%.
Further, it mandates Boeing leadership to provide semiannual reports to union leaders on workforce trends.
Market reaction
Boeing's shares rise by 3.4%
The ratification of the new contract has had a positive impact on Boeing's shares, which rose by 3.4% Thursday after the results were announced.
This is especially important considering that a strike would have been Boeing's third major labor disruption in three years.
In 2024, a machinists' strike in Seattle halted production of the 737, 767, and 777 for over 50 days.
Last year, another machinists' strike in St. Louis disrupted military aircraft production.
Strategic importance
Deal comes just in time for Boeing
The timing of this deal is critical for Boeing, as CEO Kelly Ortberg had warned last month that a strike could have stalled the certification of the delayed 777-9 and severely impacted production capacity for the 737 family.
The company is also in the final stages of bringing its recently approved 737 Max 7 and yet-to-be-certified Max 10 narrowbody aircraft to market.
These jets are vital for Boeing to generate cash, repair its balance sheet and reduce debt.