Possible UPS strike could cause massive delays

As a potential UPS work stoppage threatens to disrupt deliveries across the United States, experts warn a strike would flood other delivery institutions and companies, including the U.S. Postal Service, causing delays in service and big economic losses.

While the Postal Service would certainly experience an influx in business, post office officials are not divulging much information about how it would handle such a surge if UPS and its employee union don’t reach a deal by a Monday, July 31, deadline.

UPS is the nation’s largest package delivery company, handling about 25% of all U.S. parcel volume, according to reporting by USA Today.

Locally, UPS employs 69 union members in its Scott City facility and 35 in Sikeston, Missouri, according to Jim Barrett, the business agent with Teamsters Local 688, which represents UPS union members on the eastern side of Missouri. Barrett said the union is holding off making public comments for now in hopes progress can be made before the deadline.

“This whole thing is fluid,” he said. “And it kind of changes day to day. We’re letting the week play out before saying too much in the media.”

Chris Wilkison, a union steward with USPS in St. Louis, said he expects if UPS strikes, the post office processing centers in Cape Girardeau and St. Louis will receive volumes of mail comparable to the Christmas season.

He said USPS would probably need to hire temporary contractors to handle the workload, much like what happens at Christmastime. He said USPS may need to max out full-time employees on overtime. He also said he believes a UPS work stoppage could delay deliveries with the post office.

Unrelated to the potential UPS work stoppage, USPS has installed a new conveyor machine in Cape Girardeau and other rural areas that can process and sort mail faster than previous methods, which would help if a UPS employee strike were to occur, Wilkison said. Wilkison said the impact of a UPS strike would likely have a greater impact on the delivery side of the operation.

Messages left to the National Association of Letter Carriers Branch 1015 in Cape Girardeau were not returned.

The U.S. Postal Service has been tight-lipped about what a UPS strike could mean for the institution. Mark Inglett, a spokesman for the Postal Service, when asked what people can expect from mail delivery if a UPS strike occurs, said, “The Postal Service has a strong network, and we have the capacity to deliver what is tendered to us.” The statement is the same as given to other media outlets across the country. Inglett did not elaborate on whether deliveries could be delayed or whether more people would need to be hired to handle the volume.

National economic and logistical experts have said a UPS strike could have huge consequences for consumers. UPS delivers nearly 25 million packages daily, according to reporting by USA Today. FedEx has said it will prioritize existing customers amid industry disruptions.

UPS employs 340,000 union members and claims it delivers 6% of the nation’s gross domestic product. Anderson Economic Group issued a report warning a UPS strike “could be one of the costliest in at least a century,” adding that “only a fraction of impacted deliveries would be filled by FedEx, USPS, other carriers or direct delivery.” Anderson Economic Group, an economic consultant firm that specializes in research, business valuation, public policy and market analysis, estimated UPS customers could incur losses in excess of $4 billion.

Patrick Anderson, AEG’s CEO, said the work stoppage would “trigger near-immediate lost sales and lost wages, along with “significant and lasting harm for small businesses, household workers, sole practitioners and online retailers across the country.”

Earlier this month, UPS and the Teamsters blamed each other for negotiations turning sour. Teamster representatives said the company presented an “unacceptable offer,” while the company said Teamsters abandoned negotiations “despite UPS’s historic offer that builds on our industry-leading pay.”

The work stoppage could have big implications for shipping goods across the country, including slower delivery times, supply chain disruptions and higher shipping costs, according to reporting by Forbes. NPR reported FedEx executives have stated in an internal memo that “in the event of a market disruption, no carrier can absorb all UPS volume.”

The head of the Teamsters said Sunday he has asked President Joe Biden’s administration not to intervene if a strike were to occur. In 2022, the U.S. government intervened to block a national U.S. railroad strike that threatened to devastate the national economy.

In UPS negotiations, a sticking point, according to reporting by The Associated Press, is wage increases for part-time workers, who make a minimum of $16.20 per hour. The two sides have reportedly reached agreements on establishing Martin Luther King Jr. Day as a full holiday and to equip more trucks with air conditioning equipment.

Profits reported by UPS in the past two years are nearly three times what they were before the pandemic. The company returned about $8.6 billion to shareholders in the form of dividends and stock buybacks in 2022, the AP reported. The company forecasts another $8.4 billion for shareholders this year. NPR reported that UPS posted an adjusted profit of nearly $14 billion in 2022.

Last week, UPS announced it would begin training nonunion employees in the U.S. to fill in if the union were to strike.

UPS union members went on strike in 1997, primarily over the company’s preference to employ part-time workers to avoid paying benefits. That strike lasted 15 days.