After five weeks of striking, Boeing employees returned to work on the 19th as the union reached a tentative agreement with the company regarding wage increases. The agreement is still subject to a union vote for final approval. The meeting of the Boeing Machinists Union took place on the 15th in Seattle, as both parties worked to resolve the situation.

On October 19, Boeing announced a preliminary agreement with labor leaders, which includes a 35% pay raise over the next four years, along with additional benefits. The strike, which began on September 13, had significantly halted production of most Boeing aircraft, leading to a new wave of layoffs.

According to the Wall Street Journal, the company’s initial proposal was a 25% pay raise, which was firmly rejected by the local Machinists Union. The union regarded the new offer as sufficient to present to its members for consideration.

The union plans to hold a vote on the new labor agreement on the 23rd. The previous agreement, which proposed a 25% raise, was also recommended by union leaders but was rejected by nearly 95% of the workforce.

The strike had a stark impact on Boeing’s operations, costing the company an estimated $1 billion per month in losses. CEO Kelly Ortberg announced plans to lay off 17,000 employees and to sell up to $25 billion in stock or company bonds to solve cash flow issues. The company has warned of an expected quarterly loss of $6 billion as a result of the strike’s extended duration.

If the strike had continued, not only would Boeing’s funds have been exhausted, but key suppliers would have also faced pressures, severely impacting the company’s ability to return to normal production levels.

Boeing’s factories have been idle for over a month now, and the ripple effects are starting to affect the expansive network of suppliers. Spirit AeroSystems announced on the 18th that it would lay off 700 employees, while Boeing has agreed to acquire this struggling fuselage supplier.

With 33,000 members in the Machinists Union, Boeing’s workers in the Seattle area assemble the company’s best-selling 737 aircraft. Their average salary of around $75,000 struggles to keep pace with the local cost of living.

Garrett Dress, a Boeing employee who started last July, expressed dissatisfaction with the initial labor agreement, stating that workers need higher wages to maintain a decent standard of living in the costly Pacific Northwest.

The latest labor agreement does not reinstate pensions, a key demand for many union members, as union leaders indicated they were unable to meet that request. However, Boeing plans to increase contributions to workers’ 401(k) accounts, including a one-time payment of $5,000 to all employees’ retirement accounts.

Additionally, the company has agreed to maintain year-end bonuses, a provision that was initially removed from the proposals. The agreement also includes a $7,000 signing bonus. A significant concession made by the company was the withdrawal of a provision that would have imposed severe penalties on returning employees, which had been a major concern among many workers.

For the new agreement to pass, it requires over 50% approval from union members. Once the technicians return to work, it will take several weeks to restart the halted production lines. The company has expressed eagerness for a positive outcome from the vote on the 23rd.