John Deere (NYSE: DE) workers have voted down a second labor agreement proposed by the company, meaning the strike will continue. The results of the vote on the second proposal were much closer than the 90% down-vote seen during the first round. Workers voted to turn down the deal, 55% against to 45% in support.
"The strike against John Deere and company will continue as we discuss next steps with the company," the United Auto Workers union (UAW) statement said. "Pickets will continue and any updates will be provided through the local union."
The recently defeated proposal would have given workers wage increases of 10% in the first year and an additional 5% increase in wages in the third and fifth years. The deal also included ratification bonuses of $8,500. The initial proposal included 5% and 6% increases in the first year, and 3% increases in 2023 and 2025.
Despite the fact that the new proposal included roughly double the wage increases as the first deal, those opposed to the proposal believe that John Deere can afford to pay its workers more.
"These are skilled, tedious jobs that UAW members take pride in every day," regional director for the UAW, Mitchell Smith, said at the beginning of the strike. "Strikes are never easy on workers or their families but John Deere workers believe they deserve a better share of the pie, a safer workplace and adequate benefits."
In the first 9 months of 2021 alone, the company reported $4.7 billion in net income. In 2020, John Deere's chairman and CEO, John May, was paid $15.58 million in compensation.
The strike covers more than 10,000 workers. The average pay at the company is around $25 per hour, depending on the source.
Based on a 40-hour workweek, that means that the recently rejected proposal would have cost the company a total of around $572 million in additional wages for the first year, less than 10% of the company's estimated profits for 2021. Over the course of the agreement timeline, Deere says it would have cost the company $3.5 billion.
"Through the agreements reached with the UAW, John Deere (DE) would have invested an additional $3.5 billion in our employees, and by extension, our communities, to significantly enhance wages and benefits that were already the best and most comprehensive in our industries," Deere's chief administrative officer, Marc Howze, said in a statement.
The strike began on October 14 when workers from 14 John Deere facilities stopped showing up for their shifts and instead stood outside on the picket line. The strike effort has been helped by a labor shortage that gives workers more leverage.
Workers at other companies, including 1,4000 employees Kellogg (NYSE: K), are also striking. According to Cornell University, there were 181 strikes underway in mid-October covering some 24,000 workers. The 38 strikes seen in the first two weeks of October surpass any other full month of 2021.