Experts suggest these wage hikes may be a response to UAW President Shawn Fain’s efforts to organize U.S. auto plants run by foreign automakers and Tesla, aiming to bolster the union’s bargaining power. Fain views the pay increases at nonunion plants, including Toyota’s, as a response to UAW influence.
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Approximately 146,000 UAW members are currently voting on new contracts with General Motors, Ford, and Stellantis, entailing 25% general wage increases over the next four years and eight months. When factoring in cost-of-living adjustments, workers could see around 33% raises, with the top assembly line employee earning approximately $42 per hour.
Toyota and Honda have also aligned their starting employees’ pay progression with the timeframes outlined in the new UAW contracts.
Professor Harry Katz of Cornell University suggests that the UAW settlements likely influenced the wage hikes at nonunion factories, citing a robust labor market and the financial success of these companies. While Hyundai did not disclose specific hourly wages, it noted a 14% increase in factory worker pay over the past year at its Alabama plant.
Katz estimates Hyundai’s current hourly wage at around $25, emphasizing that nonunion plants may offer less favorable retirement, health care, and benefits compared to UAW standards. Jose Munoz, Hyundai’s chief operating officer, emphasized the company’s commitment to maintaining competitive wages and benefits.
Toyota’s top factory worker pay is set to reach $34.80 per hour in January, while Honda’s hourly rate remains undisclosed. Katz believes the UAW’s new contract is unlikely to significantly impact efforts to unionize workers at nonunion plants, particularly in regions historically skeptical of unions. The wage disparity between Detroit and nonunion plants has persisted, and organizing efforts have faced challenges in these areas.