Unions Provide Important Economic Benefit for U.S.

One of the most stunning trends in the U.S. economy during the past 15 years has been the decline of organized labor.

Can this trend be reversed? Should it? Do U.S. labor unions have a future?

I think the answer to all three questions is yes, but I also fear that the obstacles are slippery and steep.

The most striking index of labor’s declining strength and influence is revealed in its share of the labor force. Union members as a percentage of the non-agricultural work force reached its peak, 35%, in 1954. Union share then slipped gradually through the early 1970s to 26% by 1973. It then fell sharply; by the late 1980s, union members accounted for scarcely more than 15% of the non-farm labor force.

Other, more qualitative indicators tell much the same story. Through its integral membership in the Democratic Party’s postwar political coalition, organized labor enjoyed considerable political influence through the late 1960s and early 1970s; its role as a key political actor was simply presumed.

Then, as business sensed an opening and took the offensive, growing numbers of politicians began to cater more attentively to corporate interests. Labor’s declining numerical strength left it ill-prepared to counter this turn toward business. Increasingly, unions came to be viewed in the public arena as a “special interest,” selfish and inflexible. Where organized labor’s endorsement and political support was once eagerly sought by Democratic Party politicians, many now run in the opposite direction.

What accounts for these falling fortunes?

It’s useful first to eliminate the irrelevant. For one thing, such declining strength is not some inevitable byproduct of post-industrial societies; in many other advanced countries, labor unions’ size and influence have grown during the past 20 years, rather than eroded.

For example, in neighboring Canada--which is like the United States in many respects--labor’s share, once comparable to that in the United States, has climbed in recent decades to roughly 40% of the work force.

Nor can the onset of labor’s weakness be explained simply by notable changes in the composition of the labor force--growing portions of women, immigrants and younger workers. Henry S. Farber, labor economist at Massachusetts Institute of Technology, has recently concluded that “only a small fraction of the decline in unionization can be accounted for by shifts in labor force structure.”

Instead, according to most recent studies, three central factors appear to explain most of unions’ softening muscle:

* Corporations have grown increasingly anti-union since the early 1970s. Most studies suggest that business has enjoyed considerable success in forestalling or shedding union representation through tough bargaining, unfair labor practices and sophisticated campaigns to tarnish labor’s image.

* Unions themselves grew complacent during the 1960s and early 1970s, devoting declining resources toward organizing activities and often paying less attention to the needs and interests of their rank-and-file members. This inertia has been difficult to overcome, even in a time of obvious crisis. Many observers inside and outside unions continue to feel that unions must undertake much more aggressive and sophisticated efforts to organize, seeking throughout the economy to win new friends and influence people.

* Labor’s problems have affected its image with non-union workers. Growing numbers outside organized labor believe that unions would not improve their wages and job security enough to be worth the effort. As a result, according to some suggestive data, a declining fraction of non-union members say they would vote for union representation if given a chance.

If all these trends continue, some labor economists project that organized labor may represent less than 10% of the non-farm labor force by the turn of the century--a sentence to marginality in the U.S. political economy.

Should we care?

Millions of workers care. Among the 17 million people who are union members, as far as we can tell from the available evidence, unionization provides significant benefits. These rewards seem evident enough that something like a third of all non-union members would reportedly prefer union membership to their present lack of representation; this makes up a segment of the work force amounting to roughly 30 million workers. (Even that number would probably be significantly greater in a less inhospitable climate.)

Summing the two groups together, close to 50 million members of the U.S. labor force have a stake in the robustness of trade unions. Is that a “special interest”?

An even broader segment of the public should care, I would also argue, because trade unions provide a salutary influence on the broader operations of the economy. In the era of declining union influence, U.S. firms have grown increasingly inclined to take advantage of a low-wage and unprotected work force. Compared to Japanese and European corporations, many U.S. firms are sluggish, able to avoid pressures to innovate and modernize because of the easy availability of inexpensive labor.

Many economists argue that the United States has lost global competitiveness, to a considerable degree, because U.S. corporations can take advantage of, rather than cooperate with, their employees. These economists argue, as two recently concluded in a Labor Department report, that “cooperation, participation and trust within and across organizations are important determinants of the long-term performance of individuals, firms and the national economy.”

Could we move toward greater “cooperation, participation and trust”? A reinvigorated union movement would seem to be one essential ingredient of such an effort. But can recent trends be reversed?

At a minimum, two developments seem essential.

First, we urgently need reform of our labor laws to level the playing field in the continuing contest between corporations and workers seeking to organize. As many as 30 million workers say they would favor union representation but are not now in unions. In large part that’s because our labor laws allow employers huge advantages in organizing and election contests. The labor movement was shocked when the modest Labor Law Reform Act of 1978 was rejected by Congress. It’s long past when we should get something like that legislation on the books.

Second, and obviously essential to the first development, politicians must take off their blinders to which they’ve grown habituated in a decade of business domination of political discourse and recognize that what’s good for workers is good for the U.S. economy. The savings and loan crisis is only one example of the consequences of rampant laissez faire policies during the reign of right-wing economics.

If there’s a will, we can find a way to revitalize the U.S. labor movement. In a future column, I’ll provide further detail about legislative and political reforms that might help reverse the stunning and disheartening decline of unions in the United States.

Note: In my last column, I erred in reporting on an earlier column by Martin Anderson, misquoting him as saying that the recent expansion was the “longest ever.” In fact, he had written that the duration of the recent expansion was approaching but had not yet equaled the length of the long 1960s expansion. (This error did not affect the substance of my column.) My apologies.