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Boeing's Loss Could “Ripple” through OR Economy

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Monday, March 17, 2008   

Gresham, OR – Oregon has a stake in Washington State's tug-of-war to wrestle a $44 billion U.S. Air Force contract away from Airbus and back to Boeing. Recently the Washington-based aerospace giant lost its bid to build refueling tanker planes to its European rival. Boeing is protesting the decision, and the outcome will affect Oregonians. The state is home to a number of Boeing suppliers, and a Boeing parts manufacturing facility is located in Gresham.

The Oregon AFL-CIO estimates the state stands to lose about 1,000 jobs at companies that supply Boeing. More than 200 of those jobs are at the Gresham plant, where workers are members of the International Association of Machinists and Aerospace Workers (IAM).

Tom Chamberlain, Oregon AFL-CIO president, says losing the contract will have ramifications across the state.

"That equates to about $8 million a year in payroll, and we also know that when you earn a dollar in Oregon, it ripples in our economy five times. So you're talking almost $40 million that Oregonians will lose because we don't have this contract."

Last week, Boeing filed a formal protest of the decision with the federal Government Accountability Office. The Air Force says it made the decision based on performance, and that it's not allowed to consider the economic impact of its procurement decisions.

However, Chamberlain believes the Air Force contract decision was made strictly on price. He points out that the Airbus work to be done in the United States is slated to be done in Alabama, historically one of the lowest-paying states, and that more than half the jobs would move overseas.

At Oregon IAM plants, the Boeing situation is seen as another chapter in what Chamberlain calls an "outsourcing outrage."

"They're very upset -- I mean, this is a growth opportunity for those folks. They're a manufacturing union, and we know that we have seen millions of jobs leave this country in the manufacturing sector because of these out-of-balance trade agreements."

The Oregon AFL-CIO is following the issue; updates will be posted online, at www.oraflcio.org.



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