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Boeing machinists have rejected a proposed labor deal that would have ended a strike involving 32,000 employees.

Let’s bring you up to speed: The strike involving Boeing machinists kicked off on September 13, when more than 32,000 workers in the Puget Sound area, Oregon, and other locations walked off the job after overwhelmingly rejecting a tentative agreement that included a 25% wage increase over four years. The machinists, represented by the International Association of Machinists and Aerospace Workers (IAM), are striking over demands for higher wages and the reinstatement of a defined-benefit pension plan, which had been eliminated in a 2014 contract.

Where things were at: The workers initially sought a 40% wage increase to address the rising cost of living, along with the restoration of their pension benefits. Boeing’s most recent offer of a 35% wage increase, a $7,000 bonus, and other enhancements was rejected as it failed to meet all of the union’s key demands, particularly the pension reinstatement. According to the IAM, 64% of members rejected the offer. 

What the union is saying: In a statement, Jon Holden, president of IAM District 751, “Ten years of holding workers back unfortunately cannot be undone quickly or easily, but we will continue to negotiate in good faith until we have made gains that workers feel adequately make up for what the company took from them in the past.

Impacts: The financial impact of the strike has been severe for Boeing, costing the company around $1 billion each month as production grinds to a halt. This comes at a time when Boeing is already grappling with significant financial struggles, including a $6 billion quarterly loss, its largest since 2020, and an $8 billion loss for the year through September. These losses are exacerbated by ongoing production and quality control issues, which have led to delayed aircraft deliveries and heightened regulatory scrutiny. To address these challenges, Boeing CEO Kelly Ortberg announced a 10% workforce reduction and deeper cuts to manage costs and streamline operations.