This article is from Dollars & Sense: Real World Economics, available at http://www.dollarsandsense.org
This article is from the
May/June 2021 issue.
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Can the Decline of Unions Be Reversed?
Dear Dr. Dollar:
It seems pretty clear that strong labor unions have been important in reducing economic inequality. But as labor unions have represented a declining share of workers, inequality has gotten worse and worse. Insofar as the decline of unions has been a result of globalization and technological change, the picture is pretty bleak. So am I right to be pessimistic about significant reductions of inequality, at least through the impact of unions?
—Taya Abbott, Brookville, Ind.
Yes, strong labor unions have been a force for reducing economic inequality. While various factors are involved in the relationship between unions and equality, both unions’ ability to raise workers’ wages and their impact on government are involved. And, yes, things have gotten worse over the last several decades, both in terms of union membership numbers and inequality.
But, no, pessimism is not necessarily justified, both because much more is involved than globalization and technology and because of some recent potentially positive developments.
Some Potential Progress?
The recent defeat of the union drive by Amazon at its huge Bessemer, Ala., warehouse was, of course, a significant blow against union organizing. The size and importance of Amazon and its history of strongly resisting the unionization of its facilities drew a great deal of attention. Moreover, Alabama has long been an environment quite hostile to unions. Nonetheless, the union drive at Bessemer had raised the hopes of unions and union supporter across the county. So it would be easy to draw pessimistic lessons from this experience.
Yet the defeat should not have come as a surprise, and understanding that defeat could lead to positive responses. The experience in Alabama highlights the challenges facing unions and could force unions to find ways to respond more effectively to those challenges.
One of those challenges is the ability of a powerful firm, Amazon in this case, to frame the debate around a union drive. For example, according to a spokesperson, not surprisingly, Amazon claimed, “Our employees choose to work at Amazon because we offer some of the best jobs available everywhere we hire, and we encourage anyone to compare our overall pay, benefits, and workplace environment to any other company with similar jobs.” Actually, various analysts have made the comparison, and have found that when Amazon builds a distribution center in an area, wages in the area tend to fall. An example is provided by a 2018 report in the Economist magazine: “In the years since Amazon opened its doors in Lexington County [South Carolina], annual earnings for warehouse workers in the area have fallen from $47,000 to $32,000, a decline of over 30%.” It seems that because of its size, Amazon’s role in local labor markets is to push wages down generally.
More particularly, at Bessemer, while Amazon’s presence may not have pushed area wages down, according to a March New York Times article: “The most recent figure for the median wage in Greater Birmingham, a metropolitan area of roughly one million people that includes Bessemer, was near $3 [an hour] above Amazon’s pay there according to the Bureau of Labor Statistics.”
Be that as it may, at Amazon’s Bessemer operation, according to a February 7 report by National Public Radio, workers expressed concerns over “grueling productivity quotas and had wanted more input in shaping the workplace including how people get disciplined or fired.” In the era of Covid-19, workers in many plants have turned their attention to job safety and layoffs, and have found union protection an important benefit. Nonetheless, Amazon appears to have been able to convince a majority of workers at the Bessemer warehouse that they were well-paid and that pay and benefits outweighed these sorts of problems.
Beyond Amazon, in the decade leading up to 2020, union victories in elections resulting from union petitions rose from an average of 65.7% in the 2010–2012 period to an average of 71.4% in the 2017–2019 period—not huge, but nonetheless notable. Moreover, in January and February of 2020, before the pandemic came to dominance, unions won 78% and 94%, respectively, of elections brought about by their petitions. Covid-19 appears to have thrown a monkey wrench in union organizing efforts, as the number of union recognition elections resulting from union petitions fell sharply in the rest of the year.
Not Only at the Federal Level
At the state level, direct actions to weaken unions and prevent wage increases have been widespread. Several southern states have had “right to work” laws in place for decades, and recently, other states have enacted such laws. In 2011, the attacks on unions in Wisconsin highlighted this trend. A “right to work” law prohibits a union from establishing a contract with an employer that requires all workers in the establishment to join the union. The result is that, even when a majority of workers have voted the union into existence and voted for the contract, a worker can decline to join, not pay union dues, and still get the benefits bargained for by the union. The PRO Act, if enacted (see main article), would override state “right to work” laws.
In many cases, as authorities in cities and towns have enacted pro-labor regulations, state governments have overridden (“pre-empted”) those local regulations. On issues ranging from raising minimum wages to mandating paid leave to establishing fair scheduling, from 1997 to 2017, 26 state governments overrode local actions a total of 67 times, with 55 of these pre-emptions coming since 2011.
Based on the Economic Policy Institute’s “Worker Rights Preemption in the U.S.: A Map of the Campaign to Suppress Worker Rights in the States,” November 2017, (epi.org).
The experience of the last decade does not signal a dramatic turnaround for the unionization of the U.S. workforce and does not negate what happened at Amazon, but it does temper pessimism.
Political Factors
There remain, of course, the forces of globalization and technological change. While there is dispute over the relative impact of these two factors on unionization, it is clear that both jeopardize jobs and provide employers with a means to undercut unions. There are, however, two other factors that have been important in weakening unions over recent decades: political decisions and the increasingly aggressive anti-union activity of employers. Understanding these factors is a first step in figuring out how to conduct more effective organizing.
One way that political decisions, at various levels of government, undermine unions is the way in which globalization has been structured. If we take globalization to mean an increasing engagement with the international economy, there are different ways that this engagement can be accomplished. The U.S. government has implemented this engagement in ways that favor large firms, making it easy for them to move operations abroad without requiring them to bear the social costs of the dislocation they leave behind, or the environmental costs of the long-distance transportation of goods. Also, the U.S. government has been miserly in providing training and other means of support for workers displaced through globalization—or through technological change, environmental regulation, or anything else.
And then there are the direct anti-union actions of government. For example, the actions of the National Labor Relations Board (NLRB) have been especially unfriendly to unionization, as exhibited in its failure to stop workers engaged in union organizing from being fired. During Republican administrations, the NRLB has been much worse on this issue than during Democratic administrations. Yet, since the early 1950s, there has been an upward trend in the risk of being fired for people engaged in union drives.
As to Congressional action, after the National Labor Relations Act of 1935 gave a major boost to unionization, in 1947, in a very different political climate, the Taft-Hartley Act created a legislative context unfavorable to labor that has lasted for decades. The Employee Free Choice Act (EFCA), introduced in 2007, 2009, and 2016, was an example of an effort to shift the ground in favor of labor, but it was repeatedly rejected by Congress. The EFCA would have allowed a union to be certified as the official union to bargain with an employer if the union collected the signatures of a majority of workers; and the existing right of an employer to demand an additional, separate ballot would have been eliminated.
Currently, the Protecting the Right to Organize Act (the PRO Act), passed by the House of Representatives in 2020 and again in 2021, would give workers more power during disputes at work and add penalties for companies that retaliate against workers who organize. The passage of the PRO Act in the House was a sign of progress for unions. However, it has little chance of getting through a Republican filibuster in the Senate.
The political context of union-management relations has both set the stage for and been encouraged by the efforts of management to combat unionization. And a political change has also taken place in operations at the firm level. Labor historian John Logan (writing in 2006) describes the burgeoning of the “union-avoidance industry” over the last several decades of the 20th century as involving consultants, law firms, industry psychologists, and strike management firms. He points out not only their success, but also that they have prospered in an atmosphere where he notes, quoting Fortune magazine, most U.S. employers “greet the prospect of unionization with the enthusiasm that medieval Europeans reserved for an outbreak of the Black Death.” Logan concludes:
Union avoidance experts have not been the major cause of union decline in the United States in the past half-century; nor have they been the sole source of the intensification of employer opposition to unionization since the 1970s...But they have contributed to the transformation of organizing campaigns into all-out struggles to the death.
What’s the Point?
The point here is that the decline of unions and the difficulties that unions face in 2021 are not simply a result of some sort of inexorable forces, which is often how globalization and technological change are presented. The decline and difficulties have also been brought about by forces of political change, both through government and by the actions of employers and their allies in the union-avoidance industry.
What has been brought about by the force of political change can be reversed by political action, by more effective union organizing, including new approaches to organizing, and by greater pressure on the government by unions and their allies. This reality does not, perhaps, create a basis for optimism, but, along with some recent developments, leads to a rejection of pessimism.
In its efforts to prevent unionization at its Bessemer warehouse, Amazon hired the head of the consulting firm RWP Labor, one Russell Brown, who touts himself as “one of the nation’s leading labor experts where he has worked with companies in maintaining a union-free workplace.” As it turned out, the “expert” and the company were successful in this case, but that result was not automatic and can be reversed elsewhere.
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