First Move in Steel

Instead of waiting as usual for the United Steelworkers to strike the first blow in contract negotiations, management made the first move. To the Steelworkers' President David J. McDonald last week went a letter from twelve big steel companies asking for a one-year extension from this June 30 of the present wage agreement, without any increase in benefits. Although the recovery is making "moderate progress," said the letter, there is a disturbing "bulge of synthetic demand" created by fear of a steel strike, and it could lead to "decline and dislocation" later. To keep the economy on a steady course, said the steel companies, "We believe it would be wholesome if a settlement could be reached now."

Management offered no concessions, not even a pledge that if the union held the line on wages the companies would hold the line on steel prices. The letter set forth that the Steelworkers have no ground for higher wages, no need to "catch up," because their wages have risen more than those of nearly all other industrial groups in recent years. Steel wages are now 38% above the average for all manufacturing, compared to 20% above in 1953; they average $3.03 an hour v. $2.19 for manufacturing workers generally. Well aware that steel profits will be fat, the steelmakers tried to answer in advance any union claim that these are due to labor's increased productivity alone, said better productivity is due also to new plants, research, etc. Therefore, "consumers and stockholders, as well as employees are entitled to consideration."

After a quick study of the management proposal, McDonald replied: "I reject it out of hand." He accused the companies of a "publicity stunt," said, "Before the month is out [the industry] will be embarrassed by record riches which it can neither explain nor conceal."

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