Factory workers at Boeing Co.'s St. Louis facility have narrowly rejected a new five-year contract, extending a nearly three-month strike that has significantly impacted the company’s crucial military manufacturing operations. The dispute, which began on August 4th and is now in its 84th day, has seen 3,200 members of the International Association of Machinists and Aerospace Workers (IAM) District 837 miss five paychecks and has led to delays in deliveries of vital fighter jets.

Boeing's fourth contract offer was rejected by a slim margin of 51% to 49% in a vote held on Sunday. The proposed deal included an average wage increase of 24% over five years, a $3,000 lump sum signing bonus, an additional $3,000 in restricted shares, and a $1,000 bonus in the contract’s fourth year. However, the offer also contained a contentious clause that halved the pay bump workers receive every six months to 25 cents an hour.

Following the rejection, both sides exchanged criticisms. International President Brian Bryant of the IAM stated, “Boeing claimed they listened to their employees – the result of today’s vote proves they have not.” In response, Boeing labeled the union's statement “misleading,” emphasizing the close result and stating that increased interest from teammates wanting to cross the picket lines indicates many understand the value of their offer.

The prolonged work stoppage has had tangible consequences, disrupting the production of key Boeing military aircraft, notably the F-15EX fighter jet. Deliveries to facilities like the US Air Force’s Portland National Guard base have been affected, and international deliveries are expected to face delays next year, as noted by Jefferies analyst Sheila Kahyaoglu. This first significant labor strife in approximately three decades has been marked by acrimony, including an unfair labor complaint filed by the union against Boeing, and the manufacturer's efforts to hire replacement workers through job fairs.

The financial implications of this extended strike will be a focal point during Boeing Chief Executive Officer Kelly Ortberg’s earnings call on October 29. Furthermore, the situation is closely monitored by the union representing Boeing’s 19,000 engineers and technical workers, whose contract is set to expire next October. Boeing’s defense and space division, which generates nearly a third of the company’s revenue, is actively staffing up as it prepares for the production of the F-47 stealth fighter in the St. Louis area, underscoring the strategic importance of the affected facility.