A threatened strike by United Parcel Service (UPS) workers could be one of the “costliest” in at least a century, the Anderson Economic Group said Thursday.
The economic think-tank added that a potential ten-day work stoppage at UPS, the world’s biggest parcel delivery firm, could top $7 billion.
That figure includes customer losses $4 billion and direct wage losses of more than $1 billion.
A 15-day UPS strike in 1997 cost the delivery company $850 million. That was before the days when Amazon.com, founded in 1994, ushered in a seismic shift in consumer buying habits from brick-and-mortar to home delivery.
In current times UPS handles 24.3 million packages a day, totaling 6.2 billion a year, according to the company’s profile.
Roughly 340,000 union-represented UPS workers, who handle about one-fourth of all parcel deliveries in the U.S., are preparing for a potential walkout on August 1 after their contract expires at midnight July 31.
According to both the company and the workers’ union, the International Brotherhood of Teamsters, about 95% of the contract has been negotiated, with the sticking point being higher wages, including pay increases for part-time workers who account for roughly half the UPS workforce.
A spokesperson for UPS said this week, “We plan and expect to reach an agreement on a new contract before the end of July” as both sides in the negotiation seek common ground.
However, the last time UPS and its workers held negotiations was July 5, according to said Dave Reeves, president of Teamsters Local Union 767. “UPS has recorded record profits in the last two years, and our members haven’t seen any of it,” he said.