What impact would a UAW strike have on the US economy?

The United Auto Workers, the union representing nearly 150,000 workers at Ford, General Motors and Stellantis, continues to move closer to a strike.

The threat of a strike comes after GM and Ford reported record profits last year, with workers demanding what they say is their fair share.

Their demands include: A pay increase of about 40%, a 4-day work week, health care for retirees, cost-of-living raises and getting rid of a two-tiered wage structure, which keeps pay lower for newer workers. Some of those demands would undo concessions made to help control costs during the financial crisis of 2008, when the federal government stepped in to bail out automakers.

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"The companies want to say that if we strike we will wreck the economy — we're going to wreck their economy, the economy that only works for the billionaire class, it doesn't work for the working class," said Marick Masters, a business professor at Wayne State University.

Economists say a strike would absolutely impact the U.S. economy — especially the economy in the Midwest, where auto plants are concentrated.

Automakers account for 3% of America's gross domestic product, while Detroit's Big 3 make up about half of the total U.S. car market.

According to Anderson Economic Group, a 10-day strike would cost the national economy an estimated $5 billion. Not to mention the impact on the Big 3. In 2019, a 40-day strike cost GM alone $3.6 billion.

How will this affect consumers? At the end of August, the Big 3 together held about 70 days of inventory. Analysts with AutoForecast Solutions say that a strike of three weeks would clear out inventory, result in higher prices and encourage buyers to purchase foreign brands.

While a strike would pose a burden to the economy, auto workers say they have no choice but to fight for their livelihoods. For their part, the Big 3 companies say the UAW's demands are just too expensive.

@scrippsnews The United Auto Workers #union will go on strike if an agreement is not reached before midnight Thursday. This could impact unionized auto assembly facilities and manufacturing plants. The union represents workers at General Motors, Ford, and Stellantis. #auto #strike ♬ original sound - Scripps News