Railroad Strike Temporarily Averted — Here’s How It Could Have Impacted Your Wallet

Lamy, United States - September 8, 2015: The eastbound Amtrak Southwest Chief passenger train departing Lamy, New Mexico, USA.
Leadinglights / Getty Images

The already uncertain U.S. economy avoided what could have been a disaster when freight rail companies and unions reached a tentative agreement to avoid a railroad strike — something many feared would throw the economy into chaos.

Here It Is: Our 2022 Small Business Spotlight
See: 9 Bills You Should Never Put on Autopay

The agreement was reached Thursday afternoon, Sept. 15, The New York Times reported. It came only hours before a deadline that would have allowed tens of thousands of workers to strike, affecting rail service all over the country and shutting down key supply and distribution lines.

Among those cheering the news was President Joe Biden, who said in a statement from the White House that the agreement is a “a big win for America” and a “great deal for both sides.”

The deal brought a sigh of relief to those who worried how a strike would impact the economy, which has enough problems due to high inflation, rising interest rates and the specter of a 2023 recession.

Make Your Money Work for You

A railroad strike involving major lines such as Union Pacific, BNSF, CSX and Norfolk Southern likely would have wreaked havoc on the supply chain by disrupting the delivery of everything from cars and crude oil to grain, chemicals, imported goods and raw materials.

About 300,000 barrels’ worth of crude oil is shipped by rail every day, the AP reported, citing data from the American Fuel & Petrochemical Manufacturers trade association. Had a strike occurred, refineries might have had to slow production, which probably would have sent oil and gas prices higher and created fuel shortages around the country.

Similarly, the petrochemical industry might have been forced to slow production at plants that manufacture plastics and other products important to industry, Automotive News reported.

Take Our Poll: Are You Concerned That Social Security Benefits Will Be Reduced During Your Lifetime?
Discover: How To Prep Your Finances for the Next Supply Chain Crunch

Certain parts of the economy were impacted just by the threat of a strike. For example, Norfolk Southern said ahead of the strike deadline that it would stop accepting automobiles for transit at its facilities. A looming strike also sent corn prices higher.

More From GOBankingRates

Share This Article:

Make Your Money Work for You

About the Author

Vance Cariaga is a London-based writer, editor and journalist who previously held staff positions at Investor’s Business Daily, The Charlotte Business Journal and The Charlotte Observer. His work also appeared in Charlotte Magazine, Street & Smith’s Sports Business Journal and Business North Carolina magazine. He holds a B.A. in English from Appalachian State University and studied journalism at the University of South Carolina. His reporting earned awards from the North Carolina Press Association, the Green Eyeshade Awards and AlterNet. In addition to journalism, he has worked in banking, accounting and restaurant management. A native of North Carolina who also writes fiction, Vance’s short story, “Saint Christopher,” placed second in the 2019 Writer’s Digest Short Short Story Competition. Two of his short stories appear in With One Eye on the Cows, an anthology published by Ad Hoc Fiction in 2019. His debut novel, Voodoo Hideaway, was published in 2021 by Atmosphere Press.
Learn More