Boeing machinists and aerospace workers are poised to go on strike for the same reasons all unions strike: wages, benefits and job security. They don't seem to grasp three basic facts: 1. Boeing is in the process of moving much of their manufacturing oversees. 2. There is nothing these American workers can do that foreigners cannot be trained to do as well. 3. Boeing is in an extremely competitive market and a strike will simply provide additional incentives to move production oversees.

The last production/export giant in American industry is getting a new push to further outsource airplane production. It is unclear whether the last bit of the American production workforce understand what is going on but Boeing doesn't really need them. Already 70% of the new Boeing 787 airframe is manufactured oversees. Japanese, Italian, and even Russian firms are designing some of the most complex components. With competition from Airbus, the commercial airline production industry is intensely competitive and the market for skilled labor worldwide is expanding every year. The group with the least amount of leverage is that group earning the most and demanding the most - the American Boeing labor force.

It is understandable that the unions would have job security at the top of the demand list but it is the one thing Boeing cannot offer. Right now the union looks at the production backlog of 8 years and sees this as leverage. What they don't see is the current trend that will only accelerate if they give the company a reason to speed up the globalization of their production. If one looks at how dramatically the job environment changed in the past five years it is easy to foresee even more dramatic changes in the next five. None of this bodes well for the workers making their demands.

The real problem is that the machinist union demands seem reasonable and their short-term leverage is pretty strong. Boeing has made record profits and the labor force wants to share in these profits. Unfortunately, the global market doesn't work like this any more. Boeing has alternatives that they never had before plus competition pressures that that haven't had to deal with for a long time. In the 1970s the steel workers unions made their demands which the steel companies could not accept. Ultimately the bulk of the steel industry either evolved to require less labor or simply disappeared altogether in the face of foreign competition. Boeing is not in the same position. They have an alternative to losing business because of labor costs. They have a means for reducing their labor costs and gaining an additional benefit as well. Producing airline components globally gives them a sales advantage for selling their planes globally. Airbus gained significant contracts by agreeing to build portions of their planes in the countries they were delivering their aircraft to. Boeing has followed suit and this trend is likely to continue.

Ultimately, the unions better hope Boeing wins the controversial military tanker contract as military aircraft may be the one market that remains for domestic production. Five years from now union workers may be taking early retirement offers as Boeing looks to accelerate their international strategy in order to prevent the labor stoppages that have plagued them with American workers.