Home   Uninsured   Racism    Medicare    Medicaid/Medi-Cal    Mental Health    Healthcare Reform    War    Economics    All Articles   Search

2003-12-06 -- Albertsons reports 50% profit drop, Grocery strike animates LA labor


Grocery chains nationwide are trying to reduce their workers living
standards to the level of Wal-Mart, which gives its employees
hand-outs explaining how to apply for Medicaid, food stamps and
temporary assistance for needy families. Wal-Mart shifts about a
billion dollars in health-care costs to workers. Health care accounts
for about two/thirds of a union company's cost. Wal-Mart has a
$104-a-month insurance program, with a $1000 deductible.

Articles below:

  *  Albertsons blames strike for 50% reductions in profits.

  *  Grocery strike animates Southern California labor movement.


Reuters News, December 5, 2003
Albertsons Blames Labor for Profit Drop


CHICAGO (Reuters) - Albertsons Inc. (ABS.N), the No. 2 U.S. grocer,
said on Friday its quarterly profit plunged more than 50 percent,
largely because of the protracted industry strike in Southern
California.

For the third quarter ended on Oct. 30, the company said earnings slid
to $92 million, or 25 cents per share, from $188 million, or 47 cents
per share, a year earlier.

Wall Street analysts on average were expecting profit of 37 cents a
share, according to Reuters Research, a unit of Reuters Group Plc.

Shares of Albertsons fell 4 percent.

The Boise, Idaho-based chain, along with rivals Safeway Inc. (SWY.N)
and Kroger Co. (KR.N), is embroiled in a dispute involving some 70,000
striking or locked out Southern California workers opposing planned
health care cuts.

The action by the 1.4 million member United Food and Commercial
Workers Union began on Oct. 11. Albertsons also was hit by a brief
Teamsters strike in the Midwest during August.

If not for the labor disputes, the company said it probably would have
met analysts' estimates. The strikes reduced gross profit by $70
million and sales by $132 million, it said.

On a conference call with analysts, Albertson's said added costs from
the labor disputes included money to hire and train temporary workers,
travel expenses for employees temporarily assigned from elsewhere,
store security, and legal fees.

Albertsons said its mediator asked it not to comment further on the
disputes.

The company said it could not provide earnings forecasts because of
the labor problems. Last month, it withdrew its financial guidance for
the remainder of the fiscal year.

Third-quarter sales rose 1.6 percent to $8.80 billion from $8.66
billion a year earlier. Albertsons said identical-store sales, which
exclude new or replacement supermarkets, slid 1.1 percent, but would
have risen 0.3 percent without the labor disputes.

The company said a deal allowing Toys R Us Inc. (TOY.N) to put toy
aisles in its grocery stores was proving successful so far, with the
800 stores that have them showing ``strong double-digit'' sales gains
in the product category.

Albertsons said 1,200 more stores would have toy aisles by the end of
the first quarter.

The company's stocks were down 85 cents at $20.30 on the New York
Stock Exchange.


 = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = = =
= = = = =

Los Angeles Times, December 4, 2003


Grocery Strike Animates Unions

By Harley Shaiken

http://www.teamstersjc42.com/market_strike/picket1.jpg


Harley Shaiken is a UC Berkeley professor specializing in labor and
the global economy.


The 70,000 striking grocery workers received a much-needed morale
boost when the Teamsters union announced it would honor their picket
lines. But the Teamster action has an even broader significance: It
suggests a return to labor's roots and the rebirth of labor
solidarity.

Though it isn't unprecedented to have one union respect the strike of
another, union solidarity hasn't been seen on this scale for quite a
while. In the midst of a knock-down, drag-out economic struggle, the
cooperation between these two unions could breathe new life into
organized labor and transform the way strikes are waged.

Even before the Teamsters decision, the strike was buoyed by strong
public support. To start, grocery workers are neither distant or
anonymous. They are friends and neighbors, familiar faces, people you
see every time you stop by a market. They are people the public can
identify with. Close to two-thirds are women - many single mothers -
and more than a third are Latino, Asian or African American. They
aren't getting rich on the job; at an average wage of $12 to $14 per
hour and 30 hours of work per week, many are barely getting by. They
are on the picket lines because they are fighting for their
health-care coverage - a demand that is also pretty easy to identify
with.

Unions then built on this support in a way that reminds us labor is
still a movement. Miguel Contreras, head of the Los Angeles Central
Labor Council, has pulled together people from different religious,
ethnic and community organizations.

Religious groups ranging from Baptists to Muslims have thrown in their
support, initiating a week of walking prayer that brought religious
leaders to the picket lines. The International Longshore Workers Union
pulled 3,000 members off the San Pedro docks to hold a union meeting
in front of an Albertson's store. Unionized janitors staged a
three-day hunger strike over Thanksgiving, and the entertainment
unions also held rallies.

All of this support was important, but it was the Teamster decision to
honor these picket lines that clearly upped the ante. More than 8,000
Teamsters have abandoned 10 state-of-the-art distribution centers and
delivery routes to 860 stores throughout Southern California, choking
far-flung supply lines. The supermarket chains responded by bringing
in replacement workers, but it is not so very easy to replace
thousands of skilled workers overnight. The replacements will probably
get more effective if the strike continues long enough, but valued
customers are getting comfortable shopping elsewhere - a long-term
disaster for businesses that depend on loyalty and service.

Why have the Teamsters waded into the fray? They understand that if
health-care coverage is sacrificed in these negotiations, the chains
will demand the same or more from them in their own contract talks two
years down the road. The choice was to join the grocery clerks in
support of the picket line today or join the clerks with less health
coverage in two years.

Should the rest of us care? Absolutely. If unionized workers are
stripped of effective health coverage today, union and nonunion
employers alike will have a powerful incentive to cut costs in the
same way tomorrow, leaving many more workers uninsured and vulnerable.
In effect, the low road to competitiveness could become a
superhighway.

The threat here is not one of the store moving to Mexico or China but
rather of a Wal-Mart moving in down the block. The danger, although
hardly insurmountable, is real. If the unions lose, it unravels the
American dream. The reward for larger size and greater efficiency
becomes lower wages and fewer benefits. (That might benefit the
corporation next quarter, but it is hardly the basis for economic
success in the long run.)

The Teamsters, the United Food and Commercial Workers union and their
allies have given new life to the oldest of labor slogans: "An injury
to one is an injury to all." The ultimate beneficiary could well be
the rest of us.