Steel talks may follow GE model

This week's preliminary contract negotiations between the United States Steel Corporation and the United Steelworkers (USW) in Pittsburgh could be affected by an entirely different industry: electrical manufacturing.

General Electric reached a June 29 settlement with electrical workers that went against a 1982 trend of big corporate savings in labor costs. The chances US Steel and other big steel companies have of getting bargaining relief may be undercut by that settlement, Monitor contributor Ed Townsend writes.

US Steel and others are seeking relief from high labor costs in an industry burdened with critical financial problems. Members of the steel union approved early bargaining sessions, but even before the GE settlement for a 23.3 percent increase in wages and other benefits over three years, the USW rank and file appeared likely to stubbornly oppose any concessions affecting wages.

The steel and electrical-manufacturing situations are very different. The steel industry is operating at only 50 percent of capacity. Employment is down by 200,000; and some producers are near bankruptcy. In electrical manufacturing, on the other hand, GE and other companies have been operating at a profit.

Nonetheless, the GE terms that included an immediate 7 percent pay boost, may have set a precedent making it more difficult to persuade militant steelworkers to give ground on wage increases (due this fall) or on cost-of-living adjustments.

Seven other major steel producers will begin bargaining with USW later in July.