Boeing's Engineers Hold Leverage in Contract Showdown

Dow Jones
15 mins ago

Boeing Chief Executive Kelly Ortberg is juggling a host of high-profile headaches: a new software problem, production hiccups and a years-late 777X jet program-all while trying to keep its "nerds" from walking off the job.

The union that represents the company's aerospace engineers and technicians-their motto is "no nerds, no birds"-is months into its first full contract talks in 14 years. Its roughly 17,000 members are pushing for better wages, more work-life balance protections and other job improvements.

"We're working very hard to try to avoid any kind of a work stoppage," Ortberg said at a September investor conference. "That impact would be significant. If we did have a strike, essentially the 777 certification program shuts down until we get the engineers back. And it will have a ripple effect even into our production."

Councils in the Society of Professional Engineering Employees in Aerospace union have backed the company's latest proposal, which increases wages by 34% over four years and lifts average base salaries to about $208,000 for engineers and $163,000 for technicians. The new contracts still need approval from rank-and-file members, who are slated to finish a week of voting Thursday.

The risk of even a partial shutdown is immense for Boeing's core business of building passenger airplanes. Its commercial division hasn't posted an annual operating profit since 2018, before the second of two 737 MAX crashes prompted regulators to sharply limit production rates to address stubborn quality-control failures. The company's now-recovering jet output is crucial to returning the commercial business to the black.

Approval on the proposed contract is far from certain: The Seattle-area workers in August voted down an initial offer that the union's negotiating team had endorsed. Roughly 90% of voting members also authorized a strike, which could start as soon as Oct. 7 if the two sides don't reach an agreement.

Union members have said they are frustrated with compensation that has lagged behind other area employers and poor work-life balance.

"We're the brains behind the planes," said Katheryn Durkee, a veteran materials and process engineer who served on the union's negotiating team. "In the Seattle area, we're competing against top talent and it's an expensive place to live."

Housing costs in the region have grown especially quickly over the past two decades and were about 50% above the national average in 2024, according to the federal Bureau of Economic Analysis.

Kevin Boyd, a technician for the plane maker who started his career as a machinist, said Boeing's processes and controls take years to learn. That would make it hard to replace the specialists on short notice.

Certain engineers handle paperwork needed to certify new airplanes like its 777X, a wide-body model with a history of delays that have cost the company more than $15 billion. Technicians troubleshoot problems with factory machinery, fixing hiccups that could jam up production of backlogged 737 MAX jets. And Boeing depends on a small group of engineers with authorization to sign off on a plane's airworthiness, a crucial step before delivery.

Boeing's unionized workers brought the company to its knees in 2024 after a mechanics strike froze its factories for nearly eight weeks. The picket by 33,000 machinists secured the workers a 38% wage hike over their four-year contract and demonstrated the power of the Seattle-area bargaining bloc.

In the latest contract negotiations, Boeing issued a blistering statement after the union rejected its first offer and said it would start hiring more nonunion engineers and technicians to ensure work could continue in the event of a strike. But executives had softened their tone by mid-September and went further to acknowledge the leverage that its unionized workers hold.

Boyd and Durkee said they support the company's latest offer but said it is ultimately up to the full union to decide.

"This is a big gain for our labor movement," Boyd said, though "we're still continuing our preparations just in case."

 

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