Economic impacts from GM strike

Published: Oct. 16, 2019 at 10:49 PM EDT
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Several signs are pointing toward an end to the month-long GM strike after a tentative agreement was reached on

The agreement comes as the union has called members of the Union Council to Detroit Thursday morning, however, local economists are saying even if a deal is reached, it could take months for mid-Michigan to recover from the strike.

The Reo Town Pub in Lansing near the Grand River Assembly Plant says they're seeing foot traffic from the picket lines.

"Since the strike has happened, we've allowed UAW members who are out on the corners doing their job's due diligence to come in here and use the facilities as well as offer them free water, free pop and just a warm place to be when it's a little cold at night," said Corey King, a Reo Town Pub bartender.

They are hoping this traffic will create new customers after the strike.

"Once they get back to work and get their stability set back the way it was, I think they are going to come back in a larger number than they did before," King said.

The UAW-GM strike is in it's fifth week and local businesses are feeling an impact.

"The diners, I think, and the immediate service industries will snap back faster," said Patrick Anderson, of Anderson Economic Group.

According to the Anderson Economic Group in East Lansing, employee wage losses exceed $835 million and GM took a $1.5 billion hit in profits.

"Well a good chunk of that $800 million is in Michigan, roughly half and I'd say, maybe a third of that is in and around mid-Michigan so you have a significant chunk of loss wages that are right here," Anderson said.

Experts say the auto industry is an anchor in mid-Michigan and workers make up a large percent in the local economy.

"So if you are a restaurant serving people in the automobile industry, you've been feeling it for weeks now. Sometimes you are going to have empty tables. Certainly people aren't big tippers right now and they're not buying extra things," Anderson said.

Analysts predict auto workers will be cutting back and catching up for months.

"And that means that we're gonna have losses here that we are going to be feeling through the entire rest of the year. Christmas shopping, vacations, whether people buy cars, discretionary expenditures that they might postpone or not undertake at all," Anderson said.

The UAW's national GM Council will vote on the tentative agreement Thursday. The strike could end then, or it could last until a contract is ratified by union members, which could be another week or so.

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