Labor Unrest at Perrigo: Operational Risks and Unionization Trends in Manufacturing

The recent labor unrest at Perrigo, particularly the strike by Teamsters Local 210 at its Bronx manufacturing facility, underscores the growing operational risks and unionization trends reshaping the manufacturing sector in 2025. As workers demand fair contracts and protections amid corporate priorities like dividend payouts, investors must assess how such disruptions could ripple through supply chains and stock valuations.

Operational Risks: Supply Chain Vulnerabilities

The strike at Perrigo’s Bronx plant, sparked by the company’s attempt to eliminate overtime pay for 350 workers, highlights the fragility of modern supply chains. According to the International Brotherhood of Teamsters, this action is part of a broader wave of labor activism in 2025, with strikes at companies like Republic Services and Carhaul driven by similar grievances [1]. For Perrigo, the immediate risk lies in production delays and potential bottlenecks, particularly if the strike extends beyond the Bronx site. The company’s 2025 quarterly reports note ongoing efforts to mitigate supply chain disruptions through alternate suppliers, but such contingency measures often come at higher costs and reduced efficiency [2].

Historical precedents, such as the 2012 Perrigo plant strike, demonstrate how labor disputes can destabilize operations. While that event occurred over a decade ago, the 2025 strike coincides with a broader contraction in U.S. manufacturing, as evidenced by the June 2025 Manufacturing PMI of 49%, reflecting four consecutive months of contraction [3]. This context amplifies the potential for Perrigo’s labor issues to exacerbate existing supply chain vulnerabilities, particularly in sectors reliant on just-in-time production models.

Stock Performance: Investor Sentiment and Market Volatility

Though no direct data on Perrigo’s stock performance during the 2025 strike is available, historical patterns suggest that labor disputes often weigh on investor confidence. Strikes typically introduce uncertainty about revenue stability and profitability, which can drive down share prices. For example, the broader manufacturing sector’s PMI contraction in June 2025—driven by factors like tariff uncertainty and geopolitical tensions—correlates with cautious investor behavior [3]. If Perrigo’s labor issues persist, the company could face downward pressure on its stock, especially as investors factor in potential revenue losses and increased operational costs.

Moreover, Perrigo’s lack of public statements addressing the strike raises concerns about transparency. In an era where ESG (Environmental, Social, and Governance) criteria heavily influence investment decisions, companies perceived as dismissive of labor rights may face reputational damage. This aligns with 2025 trends showing heightened public support for unions, particularly among younger workers and workers of color [4].

Unionization Trends: A Double-Edged Sword for Manufacturing

The Perrigo strike reflects a broader resurgence in unionization efforts across U.S. manufacturing. While the private-sector unionization rate rose modestly to 6.9% in 2023, the National Labor Relations Board reported a 27% increase in union election petitions between 2023 and 2024 [5]. This momentum is driven by worker dissatisfaction with job insecurity, opaque management practices, and the perceived inequities of corporate spending on buybacks versus wages.

However, unionization also presents operational challenges. Monopolistic union structures, as seen in some Rust Belt industries, can slow employment growth and reduce investment, potentially harming productivity and profitability [6]. For Perrigo, the key question is whether the Teamsters’ demands will lead to a collaborative framework or a protracted standoff. Positive precedents exist: partnerships like Microsoft and the AFL-CIO demonstrate how unions can help workers adapt to technological shifts, fostering a skilled workforce and stable operations [7].

Investment Considerations

For investors, the Perrigo case highlights the need to balance short-term risks with long-term trends. While the Bronx strike poses immediate supply chain and reputational risks, the broader manufacturing sector’s push for unionization could drive systemic improvements in labor standards. Companies that proactively engage with unions—rather than resisting them—may emerge stronger, as seen in semiconductor industry collaborations like Akash Systems and the Communication Workers of America [7].

Conclusion

Perrigo’s labor unrest is a microcosm of the challenges and opportunities facing U.S. manufacturing in 2025. While strikes threaten operational continuity and stock valuations, they also signal a shift toward greater worker empowerment. Investors must weigh these dynamics carefully, recognizing that unionization—though disruptive in the short term—could ultimately lead to more resilient and equitable business models.

Source:
[1] International Brotherhood of Teamsters: Front Page,
https://teamster.org/
[2] Perrigo Company plc: Quarterly Report for Quarter Ending June 28, 2025, [https://www.moneycontroller.co.uk/finance-news/perrigo-company-plc/quarterly-report-for-quarter-ending-june-28-2025-form-10-q-3068763]
[3] Manufacturing PMI® at 49%; June 2025 Manufacturing ISM Report On Business®, [https://www.prnewswire.com/news-releases/manufacturing-pmi-at-49-june-2025-manufacturing-ism-report-on-business-302494937.html]
[4] Workers want unions, but the latest data point to obstacles, [https://www.epi.org/publication/union-membership-data/]
[5] 16 million workers were unionized in 2024, [https://www.epi.org/publication/millions-of-workers-millions-of-workers-want-to-join-unions-but-couldnt/]
[6] Do More Powerful Unions Generate Better Pro-Worker Outcomes?, [https://www.mercatus.org/research/working-papers/do-more-powerful-unions-generate-better-pro-worker-outcomes]
[7] 4 ways to strengthen US industries with unions in 2025, [https://www.weforum.org/stories/2025/01/united-states-us-industries-labour-unions/]