Rail strike would push U.S. economy into recession, chemical manufacturers say

A labor strike resulting in the shutdown of the U.S. freight-rail network would push the nation's economic recovery into a recession, according to an economic analysis conducted by the American Chemistry Council.

A strike would be felt almost immediately in the form of business shutdowns, job losses, scarcity of materials and goods and lost economic activity, ACC officials said in a press release. A one-month strike would put a major chill on several leading economic indicators through the first half of 2023, according to the group’s analysis.

"A prolonged strike would have an exponential effect for each additional month and drag the country into a potential recession much faster," said Martha Moore, ACC’s chief economist.

Chemical manufacturers would be one of the first industries to be affected as railroads would start restricting service up to a week before a threatened strike, said ACC President and CEO Chris Jahn.

U.S. chemical manufacturers are major customers of freight railroads, shipping more than 33,000 carloads per week worth $2.8 billion.

ACC officials want Congress to step in before a strike occurs.

Seven of the 12 rail unions have ratified a tentative agreement with the nation’s major freight railroads. Three unions have voted against ratification. The two largest rail labor unions — the Brotherhood of Locomotive Engineers and Trainmen and SMART Transportation Division — are expected to announce the voting results of their members early next week.

Unions that voted against ratification are in cooling-off periods, during which a strike would not occur. The earliest of those periods expires Dec. 4.