It has now been five weeks since 33,000 Boeing machinists, mainly concentrated in western Washington state, walked off the job.
And thanks to brand new analysis, we’re getting a clearer picture of what’s come from halted production from country’s largest single exporter.
“The Boeing strike is becoming more expensive over time,” said Patrick Anderson, principal and CEO of the Anderson Economic Group, a boutique consulting firm specializing in manufacturing and estimating damages and losses for over 28 years.
The total economic loss of the strike so far, according to its numbers, has been $7.64 billion — the biggest chunk being $4.5 billion lost from Boeing, $648 million of lost wages within the aerospace industry and an additional $1.77 billion for Boeing’s suppliers.
“This is going to be an increasingly large share of the total losses. If the strike goes on farther,” said Anderson of the impact on suppliers.
One example of a Boeing supplier taking a hit is Wichita-based Spirit Aerosystems, which announced Friday that beginning October 28, 700 workers will be furloughed for 21 days.
“There are only a couple of hundred suppliers who it really matters a lot to them that Boeing does well and the best example of that, of course, is Spirit,” said Michael Bruno, executive business editor of Aviation Weekly. “Without Boeing, it’s nothing. They can’t just pivot.”
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The local economy near the striking plants is hurting too.
According to Anderson, $189 million has been lost so far from the Seattle-area economy outside of the industry, like local restaurants, auto shops and dry cleaners.
“Boeing is such an anchor of the export sector of the United States economy and so important to the Washington state economy that you can’t contemplate a long strike like this without some kind of negative effect on Washington state,” said Anderson.
This week, Washington’s senators and two of the state’s U.S. representative wrote to Boeing and the union pleading for both sides to find a “mutually beneficial resolution.”
Boeing, which has been drowning in financial problems even before the strike thanks to quality and safety issues, has announced that, come November, it will lay off 17,000 workers — about 10% of its workforce.
Bruno says the writing is on the wall for Boeing to possibly break up and sell off parts of its business.
“737s, 787s, Boeing wants to be making those and selling those, delivering them, in order to really bring in the cash. Many of the defense programs can go, some of the MRO programs can go, but one way or another, almost everybody expects that Boeing’s going to be divided up somehow, someway, it’s just a question of how and when,” said Bruno.
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