Why is a rail strike bad?

Rail is critical to the entire goods side of the economy, including manufacturing, warehousing, retail and agriculture. If a rail strike lasts more than three to four weeks, the prices of goods would likely jump again, further exacerbating inflation, according to economist Mark Zandi.



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It wouldn't take long for the effects of a rail strike to trickle through the economy. Many businesses have only a few days' worth of raw materials and space for finished goods. Makers of food, fuel, cars and chemicals would all feel the squeeze, as would their customers.

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The schedules are of particular concern with rail workers citing a lack of sick leave, inability to routinely visit the doctor or tend to family emergencies, and weekslong stretches of being on call.

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Widespread economic impact Among the problems could be: Gasoline: Without freight railroads, oil refineries would have trouble producing their current volumes of gasoline, which could send gas prices higher, ending a string of three months of falling prices at the pump.

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What are the railroad unions asking for? The railroad unions are asking freight and railway companies for a pay increase, as well as better working conditions, including paid time off and a more flexible schedule.

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Another recent report put together by a chemical industry trade group projected that if a strike drags on for a month some 700,000 jobs would be lost as manufacturers who rely on railroads shut down, prices of nearly everything would increase even more and the economy could be thrust into a recession.

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There Are Still Sticking Points. The probability of a rail strike in coming weeks has increased to 30%, according to an analyst. Experts have estimated a strike could cause a $2 billion daily hit to the U.S. economy.

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For years, freight rail workers weren't allowed to call in sick the morning of their shift. They could, however, get approval weeks in advance to take paid personal days. CSX was the first to grant paid sick days to several of its unions and has now granted sick days to 61% of its 17,089 unionized employees.

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