Category: Business

(NEW YORK) — A surging stock market, low unemployment and robust growth — by just about every measure, the economy stood poised to deliver victory for Vice President Kamala Harris.

The exception, of course, was inflation, and it appears to have overshadowed other indicators. More than two-thirds of voters say the economy is in bad shape, according to the preliminary results of an ABC News exit poll.

Inflation likely shaped negative voter perceptions of the economy and helped fuel anger toward the party in power, just as it has done across the globe since the pandemic unleashed a wave of rapid price increases, experts told ABC News.

The political potency of inflation stems from the visceral, recurring sense of unease caused by high prices, experts added. That feeling leaves voters insecure about their future and desperate for a leader who can change the nation’s course.

“Inflation has a specific and special power in elections,” Chris Jackson, senior vice president of public affairs for Ipsos in the U.S., told ABC News. “It’s something people see in their face every day — every time they go to the grocery store or fill up their car.”

He added, “Inflation is present in people’s lives. It’s something they’re unhappy with and it’s something they rightly or wrongly blame on whoever is in charge.”

The pandemic set off an acute bout of inflation that impacted nearly every country across the world, when global supply chain blockages caused an imbalance between the availability of goods and the demand for them. In other words, too much money chased too few products.

Prices began to rise rapidly in the U.S. in 2021, catapulting the inflation rate to a peak of about 9% the following year. Inflation soared even higher in many other countries, including the likes of Brazil and England, where leaders faced an angry electorate.

In Brazil, where President Jair Bolsonaro cut taxes on fuel and electricity in an effort to slash prices over the months preceding an election that concluded in October 2022, the nation nevertheless replaced him with a leftwing challenger.

Earlier that year, in England, Prime Minister Liz Truss responded to the highest inflation in four decades with an economic policy centered on tax cuts and energy price controls. Her tenure in office lasted just 44 days before market reaction and political disarray led to her stepping down.

The post-pandemic pattern has exemplified a high rate of leadership change amid inflation crises around the world over the last half century, according to a study by Eurasia Group, a political risk consultancy firm. Examining 57 inflation shocks since 1970, the firm found government turnover in 58% of cases.

Further, when there was an election during or within two years of an inflation shock, it led to a change in government in roughly three out of every four instances, according to Eurasia Group.

“We’re seeing this trend on jet fuel after the pandemic,” said Robert Kahn, the managing director of global macro-geoeconomics at the New York-based Eurasia Group. “The pandemic inflation shock contributes to a sense of instability and a loss of confidence among people in their governments.”

Carola Binder, an economics professor at the University of Texas at Austin who studies the history of inflation in the U.S., characterized recent anti-incumbent sentiment in a slightly different way: “When people are experiencing inflation and suffering from it, they want to have someone or something to blame.”

Inflation has cooled dramatically over the past two years, now hovering near the Federal Reserve’s target rate of 2%. Even so, that progress hasn’t reversed a leap in prices that dates back to the pandemic. Since President Joe Biden took office in 2021, consumer prices have skyrocketed more than 20%.

The potential role of inflation in the U.S. election owes to a typical lag between when inflation comes down and when consumers acclimate to new price levels, since a lower inflation rate does not mean prices have come down but rather that they have begun to increase at a slower pace, experts told ABC News.

“When inflation comes back down, the prices of many critical items remain high, especially for people who are stretched and living paycheck to paycheck,” Kahn said.

Consumers will likely acclimate to current price levels over the coming months, but voters will remain sensitive to inflation, experts said.

President-elect Donald Trump’s proposals of heightened tariffs and the mass deportation of undocumented immigrants risk rekindling rapid price increases, some experts said.

When asked about whether inflation could reemerge as an important issue ahead of the next midterm elections in 2026, Jackson said: “If Republicans shoot themselves in the foot, absolutely.”

Copyright © 2024, ABC Audio. All rights reserved.

(WASHINGTON) — The Federal Reserve on Thursday will announce its latest decision on the direction of interest rates, setting the path for borrowing costs just two days after the victory of President-Elect Donald Trump.

The Fed cut its benchmark interest rate a half of a percentage point in September, dialing back its yearslong fight against inflation and delivering relief for borrowers saddled with high costs.

The Federal Open Market Committee (FOMC), a policymaking body at the Fed, has forecast further interest rate cuts.

By the end of 2024, interest rates will fall another half of a percentage point from their current level of between 4.75% and 5%, according to FOMC projections. Interest rates will drop another percentage point over the course of 2025, the projections further indicated.

The central bank is widely expected to cut interest rates by another quarter of a percentage point when it meets on Thursday, according to the CME FedWatch Tool, a measure of market sentiment.

In recent months, the U.S. has inched closer to a “soft landing,” in which inflation returns to normal and the economy averts a recession.

Government data released last week showed robust economic growth over a recent three-month period, alongside a continued cooldown of inflation.

U.S. hiring slowed in October, but fallout from hurricanes and labor strikes likely caused an undercount of the nation’s workers, U.S. Bureau of Labor Statistics data on Friday showed.

Since 2021, the Fed has sought to rein in inflation with elevated interest rates. Even after the Federal Reserve cut its benchmark interest in September, it still stands at a historically high level.

Inflation has cooled dramatically from a peak of about 9% in 2022, hovering right near the Federal Reserve’s target rate of 2%.

The trajectory of inflation could shift in the coming months. Trump’s proposals of heightened tariffs and the mass deportation of undocumented immigrants are widely expected to raise consumer prices, experts previously told ABC News.

To be sure, the Fed says it bases its decisions on economic conditions and operates as an independent government body.

When asked previously about the 2024 election at a press conference in Washington, D.C., in December, Powell said, “We don’t think about politics.”

The election of Trump appears to have delivered a boost for the stock market. The U.S. stock market soared at the open of trading on Wednesday, just hours after Trump declared victory.

The Dow Jones Industrial Average climbed more than 1,300 points, amounting to a nearly 3% rise in the index. The S&P 500 and the tech-heavy Nasdaq each jumped more than 2%.

Shares of Tesla, the electric vehicle company headed by Trump ally Elon Musk, spiked about 14.5% in early trading on Wednesday.

Copyright © 2024, ABC Audio. All rights reserved.

(WASHINGTON) — As former President Donald Trump declared victory in the U.S. presidential election early Wednesday, shares of his media company, Trump Media & Technology, surged about 34% to about $45.49 in pre-market trading.

With U.S. markets yet to open, early indicators appeared to show Wall Street’s bullish view of a second term for Trump. As votes were still being, Dow futures were up, the U.S. dollar was strengthening and international markets were mixed.

Dow Jones Industrial Average futures had surged about 2.9% by 6 a.m. in New York, having risen briskly from the 1.7% gain they had logged when former President Donald Trump took the stage in Florida at about 2 a.m.

S&P 500 futures traded up about 2.2% early Wednesday, while futures for the tech-heavy Nasdaq market were up about 1.7%. Shares of Tesla, the electric-vehicle company headed by Trump ally Elon Musk, spiked about 14.5% in pre-market trades.

Trump owns a 57% stake in the Trump Media, which trades under the DJT ticker and is the parent of social media startup Truth Social. The company late Tuesday reported its third quarterly loss since going public in March.

Markets in the U.S. had surged on Tuesday, led by the Nasdaq’s 1.4% rise.

As Trump walked onto the stage in Florida early Wednesday, the dollar was strengthening. The U.S. Dollar Index traded up about 1.4% at 104.75, touching a level it hadn’t seen since early August. Yields on 10-year and 2-year Treasury bonds had also climbed overnight.

Trading in Asia was mixed Wednesday as international markets digested the election results. Japan’s Nikkei closed up 2.61% for the day, while Shanghai closed nearly flat, slipping just 0.09%.

Hong Kong’s Hang Seng Index fell, dropping 2.23% by the close after opening below Tuesday’s close.

The United Kingdom’s FTSE 100 Index climbed early Wednesday, rising about 1.43% moments after open. Germany’s DAX saw a similar rise, climbing about 1.3% in morning trading.

Copyright © 2024, ABC Audio. All rights reserved.

(NEW YORK CITY) — The U.S. stock market climbed higher in early trading on Tuesday, as voters rushed to the polls and the nation awaited the results of a closely contested presidential election.

The S&P 500 ticked upward about 1%. The Dow Jones Industrial Average gained more than 300 points, jumping about 0.8%. The tech-heavy Nasdaq rose 1.3%.

Gains at large tech firms are helping to boost the market. Shares of Nvidia, an artificial intelligence chipmaker, climbed nearly 3% in early trading.

As of the early afternoon, tech giants Microsoft and Amazon each saw shares rise about 1.5%.

The market upswing follows a flurry of largely positive economic news over the past week. Government data released last week showed robust economic growth over a recent three-month period, alongside a continued cooldown of inflation.

U.S. hiring slowed in October, but fallout from hurricanes and labor strikes likely caused an undercount of the nation’s workers, U.S. Bureau of Labor Statistics data on Friday showed.

Ivan Feinseth, a market analyst at investment firm Tigress Financial, attributed the returns on Tuesday to eager anticipation among investors to move past the U.S. election.

“The nightmare of an endless election and a contentious battle has consumed a lot of the focus and attention. It’s almost over. Then it goes back to the fundamentals of the market,” Feinseth said.

The gains on Election Day extended a banner year for U.S. stocks. The S&P 500 and Nasdaq have each climbed more than 20% this year while the Dow Jones is up about 11%.

The performance has owed to enthusiasm about artificial intelligence as well as resilient economic growth and expectations that interest rates would ease, Feinseth said.

The Federal Reserve cut its benchmark interest rate a half of a percentage point in September, dialing back its yearslong fight against inflation and delivering relief for borrowers saddled with high costs.

The Fed is widely expected to cut interest rates by another quarter of a percentage point when it meets on Thursday, according to the CME FedWatch Tool, a measure of market sentiment.

An expectation of interest rate cuts among investors often sends stocks higher, since lower rates pave the way for cheaper corporate borrowing and the potential for higher profits.

“The market looks toward the future, and the Fed is now on the side of the bulls,” Feinseth said.

Over the full span of the next administration, the market will likely move higher whether the nation elects Vice President Kamala Harris or former President Donald Trump, experts previously told ABC News. However, each candidate’s policies could favor different types of stocks while posing unique risks, they added.

Trump has proposed a combination of low corporate tax rates and loose regulation that would likely bolster corporate profits and propel the stock market higher, experts said. Prices would likely increase under Harris, as they have under the economic stewardship of President Joe Biden, they added.

Copyright © 2024, ABC Audio. All rights reserved.

(SEATTLE) — Tens of thousands of striking Boeing machinists are casting ballots on Monday over whether to approve a contract offer that could end their work stoppage after seven weeks.

The new offer delivers higher pay increases and a bolstered ratification bonus that would deliver each worker $12,000 if the union approves the deal, according to the International Association of Machinists and Aerospace Workers (IAM), the union representing 33,000 Boeing workers in Washington, Oregon and California.

The ongoing standoff has strained the finances of both sides. Union members have received $250 per week from a strike fund, beginning in the third week of the work stoppage. That compensation marks a major pay cut for many of the employees.

Boeing and its shareholders have lost about $5.5 billion since the strike began in September, according to an estimate last month from the Anderson Economic Group. Shares of Boeing have plummeted 40% this year but have ticked up slightly over the past month.

Union members resoundingly defeated two previous proposals from Boeing, but the latest offer marks the best deal the workforce is likely to receive, the union said in a public letter to membership on Saturday.

“This is truly the time to lock in these gains and work to build more in future negotiations,” IAM President Jon Holden and the union’s negotiating committee told members. “Allow yourself to capture this win and be proud of your sacrifice.”

The proposed contract would deliver a 38% raise over the four-year duration of the contract, upping the 35% cumulative raise provided in a previous offer overwhelmingly rejected by workers in a vote two weeks ago. Workers had initially sought a 40% cumulative pay increase.

The proposal also calls for hiking Boeing’s contribution to a 401(k) plan, but it declines to fulfill workers’ call for a reinstatement of the company’s defined pension. Workers lost a traditional pension plan in a contract ratified by the union in 2014.

Nearly two thirds of union members rejected the most recent contract offer in a vote last month. The outcome followed the overwhelming defeat of a previous proposal in September, which drew rebuke from more than 90% of union members.

“It’s time we all come back together and focus on rebuilding the business and delivering the world’s best airplanes,” Boeing CEO Kelly Ortberg wrote in a memo to employees on Friday. “There are a lot of people depending on us.”

It will take a majority vote of union members to approve the contract offer. If workers ratify the deal, they can return to work as early as Wednesday, the union said.

“The decision to end this strike is right where it needs to be — in the membership’s hands,” Holden and the negotiating committee said in their public letter.

Copyright © 2024, ABC Audio. All rights reserved.

(WASHINGTON) — U.S. hiring slowed in October, but fallout from hurricanes and labor strikes likely caused an undercount of the nation’s workers.

A fresh jobs report marked the final piece of major economic data before Election Day. However, the data offers little more than a blurry snapshot of the U.S. economy due to the one-off disruptions last month.

Employers added 12,000 workers last month, falling short of economist expectations of 90,000 additional jobs, U.S. Bureau of Labor Statistics data on Friday showed. The unemployment rate stands at 4.1%, which matches the previous month’s level and remains historically low.

The hiring in October amounted to a sharp slowdown from 254,000 jobs added in September, though it should be interpreted with a significant dose of caution, experts told ABC News prior to the data release.

“Workers who weren’t paid during the survey period due to work disruptions won’t be counted as employed, and workers and businesses may be too busy dealing with the aftermath of the storms to respond to surveys,” Martha Gimbel, executive director of the Budget Lab at Yale University and former director of economic research at Indeed, told ABC News in a statement.

Hurricane Milton made landfall in Florida as a Category 3 hurricane on Oct. 9. It ultimately left millions without power and much of the state’s gas stations without fuel. In late September, Hurricane Helene made landfall in Florida, prompting recovery efforts that have continued for weeks afterward.

Additionally, roughly 33,000 Boeing workers walked off the job in mid-September, an action that’s expected to manifest as missing jobs for the first time on the October report.

In all, the combination of hurricanes and work stoppages is estimated to have pushed the level of hiring 50,000 jobs lower than where it otherwise would have stood, Bank of America Global Research said in a note to clients this week.

“This probably weighed on payrolls across the board, especially leisure and hospitality,” Bank of America Global Research said, pointing to Hurricane Milton. “There was also likely a minor drag from Helene,” the bank added.

Despite an overall slowdown this year, the job market has proven resilient. Hiring has continued at a solid pace; meanwhile, the unemployment rate has climbed but remains near a 50-year low.

The latest hiring data arrived at the end of a week in which new releases showed an economy growing at a robust pace while inflation returns to normal levels.

U.S. GDP grew at a 2.8% annualized rate over three months ending in September, U.S. Bureau of Economic Analysis data on Wednesday showed. That figure fell slightly below economists’ expectations, but demonstrated brisk growth that was propelled by resilient consumer spending.

On Thursday, the Federal Reserve’s preferred inflation gauge showed that prices rose 2.1% over the year ending in September. Inflation has slowed dramatically from a peak of about 9% in 2022, though it remains slightly higher than the Fed’s target of 2%.

The jobs report is set to arrive four days before Election Day. It also marks the last piece of significant economic data before the Fed announces its next interest rate decision on Nov. 7.

The Fed is expected to cut interest rates by a quarter of a percentage point, according to the CME FedWatch Tool, a measure of market sentiment.

Copyright © 2024, ABC Audio. All rights reserved.

(NEW YORK) — The U.S. economy grew at a robust pace over three months ending in September, slowing slightly from the previous quarter but continuing to dispel any concern about a possible slowdown. The fresh report marks one of the last major pieces of economic data before the presidential election.

U.S. GDP grew at a 2.8% annualized rate over three months ending in September. That figure fell slightly below economists’ expectations.

Economic growth was fueled by surge in consume spending, an uptick in exports and strong federal government spending, the U.S. Bureau of Economic Analysis said.

The new data arrived weeks after the Federal Reserve cut its benchmark interest rate a half of a percentage point. The landmark decision dialed back a years-long fight against inflation and offered relief for borrowers saddled with high costs.

Inflation has slowed dramatically from a peak of about 9% in 2022, though it remains slightly higher than the Fed’s target of 2%.

Meanwhile, the labor market has proven resilient. Employers hired 254,000 workers in September, far exceeding economist expectations of 150,000 jobs added, U.S. Bureau of Labor Statistics data showed. The unemployment rate ticked down to 4.1%, hovering near a 50-year low.

This is a developing story. Please check back for updates.

Copyright © 2024, ABC Audio. All rights reserved.

(NEW YORK) — A newly filed lawsuit has accused Subway of “unfair and deceptive trade practices” and selling its steak-and-cheese sandwiches based on “false and misleading advertisements,” that the lawsuit claims show customers getting at least three times more meat than is actually in the product.

The class-action complaint against Subway was filed on Monday in the United States District Court for the Eastern District of New York by plaintiff Anna Tollison, accusing Subway of using “photographs in its advertisements that make it appear that the Steak & Cheese sandwich contains at least 200% more meat than the actual sandwiches that customers receive,” according to the lawsuit.

“Subway’s advertisements for the Product are unfair and financially damaging to consumers as they are receiving a product that is materially lower in value than what is being represented,” the lawsuit says. “Subway actions are especially concerning now that inflation, food, and meat prices are very high and many consumers, especially lower income consumers, are struggling financially.”

The lawsuit also says that Subway’s promise of a portion that is larger is “causing consumers to come to, or order from, Subway restaurants and make purchases that they would not have otherwise made.”

The lawsuit says it stems from Tollison’s visit to a Subway in Jamaica, New York, on Aug. 23 when she picked up a steak-and-cheese sandwich after ordering it through Subway’s mobile app for $6.99 plus tax.

“After she picked up and began eating her sandwich, [Tollison] realized that there was barely any steak in the sandwich and that the photographs that she relied on were grossly misleading,” the lawsuit says.

The lawsuit is seeking unspecified damages for New Yorkers who bought the sandwiches in the last three years from Oct. 28, 2021 and alleges “egregious” violations of the state’s consumer protection laws.

This is not the first time Subway has dealt with lawsuits critical of their business. In 2021, Ireland’s Supreme Court issued a ruling declaring that for the purposes of tax law, the bread served in Subway’s hot sandwiches does not actually meet the legal definition of “bread” because of its sugar content and is rather a “confectionary or fancy baked good.”

In that case, Justice Donal O’Donnell in the Ireland Supreme Court said that the definition of “bread” was originally established to make a distinction between the starch in other baked goods, like cookies or cake or brownies, that are sugary and therefore not healthy enough to be considered essential foods.

“Subway’s bread is, of course, bread,” Subway said in a statement given to ABC News. “We have been baking fresh bread in our stores for more than three decades and our guests return each day for sandwiches made on bread that smells as good as it tastes.”

Subway also previously defended themselves against a lawsuit for more than four years claiming that their “footlong” sandwiches were too short. That case was dismissed in 2017.

Copyright © 2024, ABC Audio. All rights reserved.

(SEATTLE) — Boeing machinists overwhelmingly rejected a contract proposal this week, opting to extend a weekslong strike and send negotiators back to the bargaining table.

Sixty-four percent of workers voted against the new contract, according to the International Association of Machinists and Aerospace Workers (IAM), the union representing 33,000 Boeing workers in Washington, Oregon and California.

The outcome follows the resounding defeat of a previous proposal last month, which drew rebuke from more than 90% of union members.

The consecutive “no” votes set the stage for a standoff between Boeing and its workers that will strain the finances of both sides over the coming days and weeks, experts told ABC News. That financial pressure will push the dispute toward resolution but workers appear unlikely to budge without major concessions, they added.

“The union has sent a very clear message to Boeing that it will take significantly more to get a settlement,” Harley Shaiken, a professor emeritus at the University of California, Berkeley, who focuses on labor history, told ABC News.

The proposed contract would have delivered a 35% raise over the four-year duration of the contract, upping the 25% cumulative raise provided in a previous offer overwhelmingly rejected by workers in a vote last month. Workers had initially sought a 40% cumulative pay increase.

The proposal also called for hiking Boeing’s contribution to a 401(k) plan, but it declined to fulfill workers’ call for a reinstatement of the company’s defined pension. The contract would have included a $7,000 ratification bonus for each worker, as well as a performance bonus that Boeing had sought to jettison.

But union leaders said the concessions offered in the proposal were not enough to meet the demands of rank-and-file union members.

“This contract struggle began over ten years ago when the company overreached and created a wound that may never heal for many members,” said Jon Holden, president of IAM District 751 in Seattle, in a statement after the vote. “I don’t have to tell you all how challenging it has been for our membership through the pandemic, the crashes, massive inflation, and the need to address the losses stemming from the 2014 contract.”

Boeing did not immediately respond to ABC News’ request for comment.

Experts who spoke to ABC News forecasted a willingness on the part of Boeing to reenter talks and even revisit key parts of the offer.

Hours before workers cast ballots on Wednesday, Boeing released an earnings report showing the company had lost a staggering $6.1 billion over the most recent quarter, even though most of that period took place before the strike began.

The strike is expected to deepen that financial hole. A 50-day work stoppage would cost Boeing $5.5 billion, investment bank TD Cowen said in a report reviewed by ABC News at the outset of the dispute. So far, the strike has lasted 41 days.

“This rejection adds further uncertainty, costs, and recovery delays,” Bank of America Global Research said in a note to clients on Thursday. “We anticipate further concessions of wages will be required for a deal to pass.”

Financial stress will mount for workers as well, experts said.

Union members have received $250 per week from a strike fund, beginning in the third week of the work stoppage. That compensation marks a major pay cut for many of the employees.

“When strikes go longer than five or six weeks, the financial pressures really start to work on the union rank and file,” Robert Forrant, a professor of U.S. history and labor studies at the University of Massachusetts at Lowell, told ABC News.

While union members remain widely opposed to the latest contract offer, it drew greater support than the first one. That incremental progress may prompt Boeing to continue the strategy of upping worker pay while standing firm in its refusal to reinstate a defined pension, Ryan Stygar, a labor lawyer at San Diego, California-based Centurion Trial Attorneys, told ABC News.

Workers lost a traditional pension plan in a contract ratified by the union in 2014. The union’s demand for reinstatement of the pension may appeal more to longtime employees who feel they’ve lost retirement benefits than younger ones who’ve joined the company since its shift to a 401(k), Stygar said.

“Boeing’s strategy will be to try to exploit that generational divide,” Stygar said, noting that increased pay and a larger ratification bonus may entice younger workers to support a future proposal even if it omits pension reinstatement.

“As the strike goes on and Boeing’s losses accumulate, I think we will see more aggressive negotiation,” Stygar added, saying the standoff could stretch on for another two to four weeks.

“But I don’t have a crystal ball,” Stygar said.

ABC News’ Jack Moore and Ayesha Ali contributed to this report.

Copyright © 2024, ABC Audio. All rights reserved.

(NEW YORK) — Tens of thousands of Boeing machinists on Wednesday will vote on a new contract proposal that could end a weekslong work stoppage against the embattled aerospace company.

Workers overwhelmingly rejected a previous offer last month, putting the outcome of the impending vote in doubt.

Hours before workers were set to cast ballots, Boeing released an earnings report showing the company had lost a staggering $6.1 billion over the most recent quarter due primarily to costs associated with the strike.

“We have some really big rocks that we need to get behind us to move the company forward,” Boeing CEO Kelly Ortberg said in a letter to investors on Wednesday.

Ortberg singled out the strike as an issue that must be addressed “first and foremost.”

“We have been feverishly working to find a solution that works for the company and meets our employees’ needs,” Ortberg said.

The new offer delivers a 35% raise over the four-year duration of the contract, upping the 25% cumulative raise provided in the previous offer. The offer, however, falls short of workers’ demand for a 40% cumulative pay increase.

The proposal also hikes Boeing’s contribution to a 401(k) plan, but it declines to fulfill workers’ call for a reinstatement of the company’s defined pension. The contract includes a $7,000 ratification bonus for each worker, as well as a performance bonus that Boeing had sought to jettison.

The International Association of Machinists and Aerospace Workers (IAM), the union representing 33,000 Boeing workers, released a statement on Saturday calling the proposal “worthy of consideration.”

“With the help of Acting U.S. Secretary of Labor Julie Su, we have received a negotiated proposal and resolution to end the strike, and it warrants presenting to the members,” IAM said.

The company and its workers have faced significant financial losses during the nearly six-week strike.

Union members have received $250 per week from a strike fund, beginning in the third week of the work stoppage. That compensation marks a major pay cut for many of the employees.

Mid-ranking workers involved in the strike typically make $20 per hour, which totals $800 per 40-hour work week, while higher-paid members earn salaries upward of $100,000 per year, or nearly $2,000 per week

“The question is whether the employees and their union determine that they have the power to get more from Boeing,” Henry Harteveldt, a travel industry analyst at Atmosphere Research Group, told ABC News. “It’s whether they think they can extract more from Boeing, or Boeing says, ‘You know what, this is it.'”

The strike was set to cost Boeing $108 million per day in lost revenue, amounting to as much as $5.5 billion in losses should the work stoppage last 50 days, investment bank TD Cowen said in a report reviewed by ABC News at the outset of the dispute. So far, the strike has lasted 40 days.

In September, Boeing announced furloughs and pay cuts for some white-collar employees in response to the strike. Last week, Boeing CEO Kelly Ortberg announced plans to cut 17,000 jobs, which amounts to about 10% of its global workforce.

“This is really painful for Boeing,” Richard Aboulafia, managing director of aerospace consulting firm AeroDynamic Advisory, told ABC News.

The most recent IAM strike against Boeing in the Pacific Northwest, in 2008, lasted 57 days. Work stoppages undertaken by unionized Boeing employees in the same region have historically lasted an average of 60 days, a Bank of America Global Research analysis found after examining seven previous strikes, the earliest in 1948.

Workers will cast their ballots in a ratification vote on Wednesday. If a majority of workers back the proposal, the contract will be adopted and the strike will end.

Over the days leading up to the vote, the outcome remained unclear, Jake Rosenfeld, a professor of sociology at Washington University in St. Louis, who studies labor, told ABC News.

“What are the workers going to do?” Rosenfeld said. “That’s a really tough question.”

Copyright © 2024, ABC Audio. All rights reserved.