Earlier this spring, as the coronavirus pandemic was spreading across the country, a study was released that ranked Maine as the state most likely to face severe economic fallout from the pandemic. Given our state’s demographics, with a large elderly population, and economics, with many businesses dependent on tourism and industries dependent on close social contact, it is understandable that we will be hard hit. With an unemployment rate near 10 percent and more than 100,000 people filing unemployment claims, we know there is already tremendous suffering here.
That is why it has been so painful for me to watch the labor strike going on at Bath Iron Works right now. Now in its fourth week, the strike is inflicting unnecessary damage on our economy and making it even harder for Maine to recover from the pandemic.
As one of our state’s largest employers, with a $375 million annual payroll, BIW has provided good-paying jobs for thousands of Mainers for more than 130 years. And the company’s operations have a ripple effect on our economy, as it buys goods and services from almost 300 suppliers across the state. BIW has invested more than $700 million in its facilities since 1996 and spent $125 million on direct goods and services from Maine suppliers in 2018 and 2019 alone. Those are vital investments for the business and for sustaining many Maine families and communities.
BIW’s operations have been particularly important to Maine’s economy during this pandemic. While many other businesses were shuttered, BIW remained open because of its role in the nation’s essential defense infrastructure. That meant paychecks continued to go out to BIW workers and orders continued to go out to suppliers. In fact, to encourage social distancing at the yard, the company purchased more than 250,000 meals for its employees from local restaurants, keeping many of those businesses from going under when no other customers were coming through their doors.
BIW also helped Guilford-based Puritan Medical Products speed up production of its COVID-19 sterile testing swabs, which are facing a nationwide shortage. The company built and delivered 30 machines to speed up swab production. BIW’s unique combination of skilled employees and manufacturing facilities has delivered a critical component needed to increase nationwide COVID-19 testing capacity.
Until COVID-19 and the strike slowed its production, BIW was on a hiring spree. Since the beginning of 2019, the company has hired more than 2,000 workers, and said it plans to hire at least another 1,000 this year. At a time when other Maine companies are shedding workers, BIW is adding critical new jobs. At a time when the International Association of Machinists is facing substantial job losses at facilities across America, BIW has increased the number of IAM union jobs here in Maine. And these jobs pay well – averaging 22 percent more than other manufacturing jobs in Maine and providing solid health care and pension benefits.
The company offered pay raises and bonuses and a continuation of its benefit programs. The primary source of contention in the strike is over the issue of subcontracting. BIW says it needs flexibility to use temporary subcontractors in certain cases to keep shipbuilding on schedule for its customer, the Navy. The company is already about six months behind schedule and has lost a series of recent contracts for future work due to its production delays. They can’t hire and train workers fast enough in key trades to keep up with the demand. BIW’s striking union wants none of it, claiming that the subcontracting isn’t needed.
As president of the Maine State Chamber of Commerce, it is my job to advocate for the well-being of Maine’s economy, businesses and workforce. That means I speak for both the businesses and the workers they employ. And it is clear to me that a compromise is needed. We can’t afford to see more jobs lost to other shipbuilders in Wisconsin and Mississippi. There is simply too much at stake for our state if BIW can’t be successful. Let’s end this strike and get BIW (and Maine) back to business.
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