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Washington Post columnist Steven Pearlstein has an interesting take this morning on the ongoing labor negotiations in Washington, DC, between Safeway and Giant and the United Food and Commercial Workers (UFCW) union.

The current model, Pearlstein writes, is broken.

"With health insurance premiums now rising 10 to 15 percent a year, it is simply unrealistic for workers to expect they should continue to contribute very little toward the cost of health plans," he writes. "And with seven-day schedules now a way of life in the retail sector, it's hard to justify paying clerks $20 -- or, in some cases, $30 -- an hour to scan canned peas just because it's Sunday. The hold-the-line union position is reminiscent of the rallying cry of unions in industries that now barely exist in the United States.

"At the same time, it is folly for Safeway and Giant to think they can regain their competitiveness simply by cutting labor costs. Like their similarly challenged cousins, the department stores, the real challenge for traditional supermarkets is to figure out how to improve quality, service and the overall shopping experience in ways that justify higher prices, higher wages and higher profits."
KC's View:
Quite right.

In other words, labor has to change its approach to the market, and management has to realize that it has to stop using labor as a whipping boy for its own lack of competitiveness.

And until both sides come to these realizations and actually start to work together, the supermarket retailing industry will remain essentially corrupted by its own short-sightedness and unable to do the things necessary to compete effectively.