The UPS Strike

The UPS Strike

E-mail debates of newsworthy topics.
Aug. 19 1997 3:30 AM

The UPS Strike

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Dear Tom,

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       Let me respond to four points raised in your letter.
       1) Do UPS part timers get only $9 an hour? (The right figure for wages is closer to $10.) You forget that wages make up only part of the total pay package. Ann works for a company that provides her with "free" parking, while Barb, who works in the next office building, has to pay $40 a week for parking. The value of parking, including the tax advantage, ought to be added in when we compare Ann's pay to Barb's. A part-time worker at UPS receives the same health-insurance benefits as a full-time worker, is entitled to a bonus of $500 if she stays for six months, and will be entitled to profit-sharing worth more than $1,000 when the contract is signed. It is a far better package than what a part-time worker could earn at the local supermarket or mall store.
       2) Have real wages for the average worker really gone down? Your friend Roach probably read the report of the commission chaired by Michael Boskin at Stanford University and the Hoover Institution. The official Consumer Price Index is biased by 1.2 percentage points a year. If we used an unbiased price index, real wages actually increased since 1989. Susan E. Mayer (the author of What Money Can't Buy) correctly concluded that real wages must have increased between 1980 and 1990. Otherwise, we cannot explain how households in the lowest 20 percent of the income distribution were able to buy more air conditioners and rent more living space per person.
       In passing, you claim that $20 an hour (the wages of a full-time UPS worker) isn't so hot in Europe or Japan. You do not point out that a Ford Escort is twice as expensive, gasoline is $3 a gallon, and you have to pay $11 for a bottle of beer in Stockholm. $20 an hour plus fringes goes a lot far further in Little Rock.
       3) Is the fraction of part-time jobs the relevant statistic, or is it the number of full- and part-time jobs created by UPS? The facts seem to be that UPS has created more jobs of both kinds, but more of the newly created jobs are on part-time schedules, not because a person can't work more than 4 hours a day, but because the nature of the UPS workload has shifted toward air freight. Our local supermarket chain has sharply increased the fraction of clerks on part-time schedules, due in part to staying open longer hours. More customer traffic is occurring in the early evening and weekends as more women have entered the labor force. The growth of UPS may simply call for a higher ratio of part-time to full-time workers. There is surely room for negotiation here. The Teamsters and UPS might consider a "tenure track" part-time arrangement entitling the worker to get seniority wage raises for part-time work and preference in applying for full-time jobs.
       4) Who is responsible for funding retirement, the Teamsters or the employer? If the Teamsters assume the financial responsibility, how should the burden be distributed across multiple employers? Will all Teamsters (UPS drivers and sorters, teachers, and union members of Teamsters unions in Montana) get the same retirement benefit?
       Finally, you asked what we full-time professors think about adjuncts who get $3,000 for teaching a course. The adjuncts have a different task assignment and different responsibilities to the university. I once complained about how much time I was spending in endless meetings. A very eminent lawyer quipped, "Nothing wrong with meetings at an hourly rate."

Walter Oi

Thomas Geoghegan is a labor lawyer in Chicago. He is the author of Which Side Are You On? Trying to Be for Labor When It's Flat on Its Back. Walter Oi is the Elmer B. Milliman Professor of Economics at the University of Rochester.