Strikes within the food and beverage sector cost companies and employees $145.9 million in lost wages and revenue last year, according to a review by Noggin. And across the economy, the 10 largest strikes cost $6.2 billion.
Strikes affected some 16,400 food industry workers who were sidelined for an aggregate 236,200 days at a cost of $40.9 million in wages while the companies lost $105 million. Kroger, Aramark, Starbucks, and New Seasons Market were among the companies involved.
“Employees [are] getting tired of the status quo and taking matters into their own hands,” Rachel Gonzalez, partner in the employment and labor practice at Day Pitney LLP, told The Food Institute. “The issues behind the recent strikes in the hospitality industry are neither new nor sudden.”
“Workers have organized for different reasons, but health and safety, compensation, including how tips are handled, and wanting more influence in workplace issues seemed to be central in many of the organizing drives.”
Noggin’s study looked at five years of data involving strikes at 145 companies with at least 1,000 employees.
Last year, strikes cost the manufacturing industry $3.2 billion, the information sector $2 billion, and the education realm $328.9 million.
Economics Professor Roberto Pedace of Scripps College said food and hospitality workers have often been the victims of low wages, limited fringe benefits, minimal job security, and undesirable working conditions – all conditions that fuel job dissatisfaction.
“Strike activity has short-term costs for all parties: Employers have interruptions in their production process, workers must rely on a strike fund that isn’t always adequate to maintain their income, and consumers may encounter shortages and/or higher prices for goods and services,” Pedace said.
Noggin general manager James Boddham-Whetham said the hospitality industry strikes were complicated by other issues, including supply chain pressures, and noted that better communication between employees and management is key to avoiding labor strife.
Gonzalez agreed: “If management has gone rogue and is not treating employees fairly or is treating employees poorly, that needs to be addressed immediately. Poor management will often buttress other issues and incentivizes people to strike.”
The Food Institute Podcast
It’s tariff time, and companies the world over are working to better understand how their operations will be impacted. Jodi Ader from RSM US LLP joined The Food Institute Podcast to discuss which products and inputs are currently subject to tariffs, and how to best mitigate supply chain risks.
