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Monday, July 22, 2024

Autoworkers Prepare to Strike for a Place in the EV Future

Ethan Surgenavic was excited to begin work at a new electric vehicle battery-cell plant in Ohio’s Mahoning Valley last summer. The Ultium Cells plant is a joint venture of General Motors and South Korea’s LG, and he grew up in the area when GM was known for well-paid, unionized jobs. “I thought this might be my opportunity to get in on the ground floor of something great,” the HVAC technician says of his job on the leading edge of the EV boom. Then he started work.

The lithium in EV batteries can react violently with water, and Surgenavic’s job involves controlling humidity in the battery plant’s rooms to precise levels. But he says wages are too low to attract enough qualified workers to maintain the huge building. When Ultium opened, production workers started at $16.50 an hour and maxed out at $20 an hour, a level far below GM’s own plants and one that 28 US senators called “a national disgrace” in a July letter to battery plant owners. Ultium staff voted to unionize with the United Auto Workers (UAW) in December, but are still bargaining their first contract. Chemical spills, exposures to toxic substances, and other safety problems have landed Ultium with $31,000 in fines from US federal regulators, with six investigations still open. Ultium spokesperson Katie Burdette says the company prioritizes safety and works with UAW-appointed safety representatives, but Surgenavic and others say the shiny green EV revolution isn’t looking so good for workers so far.

The fate of workers as the auto industry decarbonizes is part of tense negotiations this week that could see 150,000 autoworkers go on strike. The UAW’s four-year-old contract with the Big Three US automakers—Ford, GM, and Stellantis—was forged before drivers embraced EVs, and expires at 11:59 pm on Thursday, September 14.

Autoworkers aren’t natural allies of work on climate change, but that’s changing as the industry electrifies and more workers like Surgenavic move to the EV supply chain. UAW has vocally supported climate policy, including tougher fuel economy standards, and it and other unions are embracing the concept of a just transition, credited to ideas developed by labor leader Tony Mazzocchi in the 1990s and mentioned in the 2015 Paris Climate Agreement.

As society shifts away from unsustainable industries, the philosophy goes, workers and their communities shouldn’t shoulder the burden. J. Mijin Cha, an assistant professor of environmental studies at UC Santa Cruz, says research shows that the just-transition approach has wider benefits by decreasing opposition to new sustainable industries. “By making a more just society overall, we can actually accelerate an energy transition,” she says.

The automakers have argued that they need to control labor costs to invest in electrification while staying competitive with non-union competitors that include overseas rivals such as Toyota and Honda and domestic EV makers like Tesla and Rivian. The UAW says its members deserve their fair share of the Big Three’s soaring profits—$21 billion in the first half of 2023. Their demands, self-admittedly “audacious,” include a mid-30 percent raise over four years in line with increased executive salaries, restored pensions, a 32-hour work week for 40 hours of pay, and good jobs for the next generation of EV workers.

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Like GM, Ford and Stellantis have launched their own joint EV battery ventures with South Korean electronics companies. The UAW says the new businesses are offering jobs with lower pay and safety protections than at established unionized auto plants. Last month, the recently unionized Ultium workers inked an interim agreement to raise wages by an average of 25 percent, but the union wants to bring battery plants to the same standards as at the Big Three. Experts say that may be a tall order, but a strong contract could help win over new workers and reverse a decades-long decline in the union’s membership. The future of US automotive jobs may depend on it.

“The combustion engines used to be built within the Big Three,” says Harry Katz, a professor at Cornell University’s School of Industrial and Labor Relations. “Now you have batteries that are not coming from within the Big Three and being assembled and developed by workers making lower wages and benefits. That's a real problem. The UAW has got to find a way to try and organize those domestic battery plants.”

Marick Masters, a professor at Wayne State University’s Mike Ilitch School of Business, calls the UAW’s fight to organize the producers of EVs and their components “existential” for the union, noting that about 60 percent of US auto manufacturers and parts suppliers were unionized in the early 1980s. Now that number hovers around 16 percent.

Some assessments reckon that producing EVs, which have fewer moving parts than gas-powered vehicles, requires fewer workers. Ford’s CEO said last year that EVs would require 40 percent less labor, while a recent study from Carnegie Mellon University found that battery electric vehicles actually require more labor due to the requirements of battery pack manufacturing.

Either way, without significant growth in domestic EV production, US automotive jobs will likely decline, particularly if the White House realizes its goal of EVs representing 50 percent of new car sales by 2030. A 2021 analysis by the Economic Policy Institute, a pro-labor think tank, estimated that without policy intervention, meeting that goal would cost the US auto industry 75,000 jobs, since the majority of EV powertrain components are produced and assembled elsewhere.

If policy measures spurred a significant increase in the US market share of EV assembly and production, then the industry could add 150,000 jobs, the researchers estimate. But many of those jobs won’t be in traditional UAW-unionized plants. Foreign transplants like Honda and Toyota and EV companies like Tesla have long resisted unionization. “I think that has provided a model to other EV manufacturers in this country, who, even if they wanted to, can’t avoid looking at Elon Musk’s example,” says Jason Walsh, executive director of BlueGreen Alliance, a partnership between labor unions and environmental groups.

The Inflation Reduction Act (IRA) passed in the US last year offered up billions of dollars of loans and tax breaks for onshoring and reshoring EV manufacturing jobs. But it included no labor standards or wage requirements for the recipients of those funds. “There have honestly never been more federal resources available to help automakers build the vehicles of the future,” says Walsh. “Auto manufacturers can’t be allowed to use this historic shift as a smokescreen to drive down job quality.”

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Concern that moving to a greener economy will hurt workers is backed up by evidence from big industrial transitions of the past. Globalization and deindustrialization led to widespread auto plant closures and shipped many jobs overseas, says Cha of UC Santa Cruz. An April study from UC Berkeley titled “Fossil Fuel Layoff” found that unionized workers who lost their jobs when a California oil refinery closed mostly found new work, but it was often lower-paying with poorer working conditions. The researchers say potential solutions include cash payouts for transitioning workers and targeted training for new jobs in specific industries.

Some governments have embraced just transition initiatives. Since 2021, the US and some European countries have forged Just Energy Transition Partnerships with several emerging economies including South Africa, Vietnam, and Senegal, intended to stimulate investment in renewables while ensuring good jobs. Illinois and New York have both instituted labor requirements for renewable energy projects over a certain size, while Colorado established the first US state-level Office of Just Transition last year. But no federal department has taken up a similar charge, and a provision that would have attached IRA funding to unionized EV companies was killed.

For Chris Viola, who works at Factory Zero, GM’s EV assembly plant in Detroit, Michigan, his personal green transition was marked by a series of plant closures and job eliminations—yet it has also been smoother than that of many of his colleagues. He works as an electrical problem solver, liaising between design engineers and production staff, and when he started at GM in 2007, workers received pensions, retiree health care, and a three-year path to the top wage.

After the UAW made concessions during the Great Recession, new workers did not receive pensions or retiree health care, and now have to wait eight years to reach top pay. And Viola says that GM’s new EV supply chain seems to involve more subsidiaries, which pay less and offer inferior benefits. Workers doing similar jobs receive vastly different compensation, Viola says, a system the UAW is fighting to eliminate. “Auto jobs have historically been regarded as good jobs in the area,” he says. “At least in my tier, you can make a good living, own a house. I cannot imagine anyone doing that now.”

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