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Moderation dominated labor contract negotiations in 1992. Major collective bargaining settlements negotiated in private industry in the year called for changes in wage rates that were lower, on average, than those in the contracts they replaced. Additionally, wage changes provided by settlements in 1992 were, on average, at the lowest level since 1988. Furthermore, the more moderate settlements were accompanied by a record low number of major work stoppages (29) in 1992. (Data on major settlements cover bargaining units of 1,000 or more workers; data on major work stoppages cover strikes and lockouts involving 1,000 or more workers.)
Major economic indicators in 1992 may have posed somewhat of a quandary for negotiators. Gross domestic product rose at the fastest pace since 1989, and with price changes at their lowest level since 1986, inflation was not a concern. (See table 1.(1)) (Table 1 omitted) Boosted by increases in output and a decline in labor hours, labor productivity in the nonfarm business sector posted the largest increase since 1972, and only moderate increases were recorded in employers' costs for compensation as measured by the Employment Cost Index and unit labor costs. Despite various signs of an improving economy, concern about jobs remained for those at the bargaining table. The unemployment rate continued rising during the first half of 1992, and announcements regarding job cuts--reflecting slow demand, technological changes, and restructuring by companies--persisted throughout the year in many of the industries in which bargaining was scheduled.
WAGE CHANGES IN SETTLEMENTS
Not since 1988 have current settlements provided wage rate changes that were lower than those in the contracts they replaced. (See chart 1.) (Chart 1 omitted) Major settlements in 1992 provided changes in wage rates that averaged 2.7 percent increases in the first contract year and 3.0 percent annually over the contract term. (See table 2.) (Table 2 omitted) (The average change is the net effect of decisions to increase, decrease and not change wages.) In the previous settlements, which were primarily negotiated in 1989 and 1990, wages were scheduled to change, on average, 3.6 percent in the first year and 3.4 percent per year over the term of the contract. (The Bureau's measures of wage rate changes under collective bargaining settlements exclude potential changes under cost-of-living clauses...