NEW YORK (CNNMoney.com) - New York City was poised to be hit by a transit strike as the union representing bus and subway workers announced early Friday they had not been able to reach agreement with management after all-night talks.

Roger Toussaint, president of the Transport Workers Union Local 100, which represents about 34,000 workers, announced just after 7 a.m. ET that the union would start a strike against private bus lines operated under the Metropolitan Transportation Authority, starting Friday evening, and that the strike would then be extended to other "MTA properties."

Initially, union officials said the strike would begin after Friday morning rush hour, but union shop stewards are telling employees the strike will start Sunday night.

A spokesman for the MTA was not immediately available for comment about the strike threat.

Toussaint, speaking at union headquarters, did not give details when city buses and subways could stop running. He said the union was prepared to continue bargaining, but he criticized MTA Chairman Peter Kalikow, whom he said did not join talks until an hour before the contract expired at 12:01 a.m. Friday.

A strike by the TWU is illegal, and the city has won an injunction against a strike, which it estimates could cost the city's economy $400 million a day. The city buses and subway carry about 7 million riders on a typical work day.

A strike could disrupt operations at many Wall Street firms, many of which are making contingency plans to get their employees to and from work.

From Toussaint's comments, the two sides still appeared to be far apart on basic economic issues, including wages, health care benefits and pensions.

The first two privately owned bus lines that will apparently be affected by the strike are the Triboro and Jamaica bus lines, which serve commuters in sections of the boroughs of Brooklyn and Queens. They have 490 drivers and 217 drivers, respectively, and Toussaint said they have been without a contract for three years.

A strike would be the first since an 11-day strike in April 1980 that cost the city an estimated $1 billion.

If the strike takes place next week, New York City Mayor Michael Bloomberg said it could result in layoffs before the Christmas holiday.

"It's the final shopping week before Christmas and it would hurt an awful lot of people who would probably lose their jobs during the week," he said. "A lot of people who work at restaurants and bars and stores and doing other things that if customers can't get there, they don't have a job and they don't get paid."

On Thursday, Kalikow urged the union to submit to independent arbitration if the negotiations fail but Toussaint said on Thursday his recommendation to union members "will definitely not be arbitration."

Major issues include wage increases, health-care benefits and pension provisions, which the union believes is affordable, pointing to a reported $1 billion surplus held by the MTA, based largely on increased value of its real estate holdings.

But Kalikow said Thursday: "The MTA's long-term financial outlook, like every business and government in this country, is seriously clouded by the extraordinary growth of pensions and health-care costs."

Under the city's contingency plans, cars would have to carry at least four people to be allowed through bridges and tunnels feeding midtown and lower Manhattan between the hours of 5 a.m. and 11 a.m. It is not immediately clear if those plans will take effect if only the private bus lines are on strike Monday morning.

Staging areas would enable automobile drivers to find the necessary passengers to get into the city, Bloomberg announced earlier in the week. The city's fleet of would be allowed to take multiple fares with a cap of $10 per passenger for trips within designated zones, while public schools would open two hours later than usual to accommodate the 600,000 students who use city transportation.

Under the state's Taylor Law that bans municipal strikes, employees can be fined two days' pay for every day on strike.

The city also filed a lawsuit to fine the union $1 million and each striker $25,000 on the first day of a strike to recover any damages the city suffers.