UAW contract with GM will impact regional economy - WFMJ.com News weather sports for Youngstown-Warren Ohio

UAW contract with GM will impact regional economy

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Terms of a new contract for United Auto Workers at GM in Lordstown will have an impact beyond the walls of the plant and the workers pockets.

The bonuses and wage increases will not only be a plus for workers, YSU  Economics Professor A.J. Summell says the multipliers will be significant for the local economy.  
"I mean just the signing bonuses, which is eight thousand dollars per worker, you're looking at additional gross income in excess of 30-million dollars in  this region," Summell said. 
With more money in their pay check Summell says you can expect workers will spend some of that additional income locally which in turn supports other local businesses and jobs.
"If they're waiting to do some home improvements or maybe waiting to buy a new car or if it's just to go out to dinner a few more times or go to the racino," said Summell.
For Trumbull county that could mean important support for it's new campaign to "Shop Local" and boost the sales tax.
"If they spend that money and buy local it's going to help with our sales tax which is a big part of the income that helps us run the county," County Commissioner Frank Fuda said.
The Village of Lordstown has a one percent income tax, and one percent of just the UAW bonuses is more than 350-thousand dollars. Lordstown Mayor Arno Hill says the benefit to the village will be substantial over the life of the new contract.

Professor Summell says the phasing out of the two-tier wage system will be significant for those workers on the lower tier.
"They're seeing almost a 100 percent increase," said Summell.
Another factor that is important to the local economy is job security for four years. 

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