White House Announces Tentative Deal to Avert Rail Strike

White House Announces Tentative Deal to Avert Rail Strike

Union officials, management, and Biden administration officials have been racing to avert a potential rail shutdown that could have disrupted cargo shipments and impeded food and fuel supplies. The White House now says it has reached a tentative deal to avert a strike, but any agreement will have to be approved by union members.

One of the smaller unions involved in the dispute rejected a deal and railroads including Union Pacific, Berkshire Hathaway’s BNSF and Norfolk Southern have until a minute after midnight on Friday to reach tentative deals with three holdout unions representing about 60,000 workers. The main points are related to workplace conditions and sick leave.

A shutdown would have frozen almost 30% of U.S. cargo shipments, potentially raising inflationary pressures, and costing the U.S. economy as much as $2 billion per day by some estimates.

Amtrak has already canceled many long distance passenger rail routes until the situation is resolved. Some rail operators have also halted the transportation of some hazardous materials so they are not left unattended.

Shares of Union Pacific (UNP) rose 4.7% in pre-market trading. Shares of CSX (CSX) were up over 2% in pre-market trading.