Compass: Unions still needed, but old thinking won't save them

By GREGORY FISHERAugust 31, 2013 

Based on studies conducted by the Bureau of Labor Statistics, union membership is at an all-time low in the United States. Approximately 11.3 percent of all public and private workers belong to a union. Only 6.6 percent of private sector workers belong to a union. The rate is significantly higher in the public sector where 35.9 percent of workers are union members. Union membership has consistently declined in the United States since the 1950s when at one time nearly 35 percent of all private and public sector workers were union members.

For unions, perhaps the most alarming trend is that only 4.2 percent of workers under the age of 25 are members of a union. The highest percentage of union members is found between the ages of 55 and 64 (14.9 percent). In 1983 the average age of union workers was 38. In 2010 it was 45. Meanwhile, public sector unions are confronting the twin pressures of declining revenues and increasing government expenses. Detroit is a harbinger not an outlier. Unions are dying out.

Alaska is an exception. Alaska is one of three states with a unionization rate exceeding 20 percent, the other two being New York and Hawaii. However, even in the Great Land union membership has decreased in the past decade from 24.4 percent in 2002 to 22.4 percent in 2012. The high percentage of union membership in Alaska is probably attributable to our unique economy and demographics.

Labor theorists offer many reasons why union membership has consistently declined since the Great Depression. Some believe that changes in federal law made it easier for businesses to discourage employees from joining unions. Others think state and federal laws addressing wages, safety and other workplace issues made unions somewhat obsolete. Economists observe that companies with unionized workforces are less flexible, placing them at a competitive disadvantage and making them more susceptible to market elimination. Industry analysts observe that good business leadership has adopted the Watson Brothers' philosophy, sharing wealth and management to the extent that unions are not needed.

It is not clear whether unions promote or hinder economic growth. Statistics maintained by the Bureau of Economic Analysis reflect a mixed picture. However, most agree that purchasing power and income security drive economies. Our economy is based on consumer activity. Labor goals are traditionally aimed at securing better wages, benefits (health and pension), job security and working conditions. Labor unions also provide checks and balances to business management.

Consequently, one would think that unions should boost the economy by putting more money in workers' pockets. Although I represent employers, businesses and contractors, I openly concede we need labor unions. They are a key player in a healthy economy.

We need unions but they have been in a sharp decline for 70 years. How can unions be saved?

The best and most effective way to save unions is to promote policies that create jobs -- skilled, good-paying jobs. Historically, more jobs mean more workers, which leads to stronger unions. Our legislative policy choices, however, often work at odds with job growth. One example is the Affordable Care and Patient Protection Act (Obamacare).

Another is seen in the little Davis-Bacon acts that many states have that require high wage standards for occupational trades on public construction projects. The federal Davis Bacon Act and its state spinoffs were products of the Great Depression. The acts were necessary then to prevent contractors from importing cheap unskilled labor or from winning bids by depressing wages. The need for these protections, however, evaporated long ago. Latest estimates are that it will cost $3.2 trillion to repair the nation's infrastructure. States that have repealed their Little Davis-Bacon acts have enjoyed savings in the range of 15 percent.

These savings have been plowed back into more construction projects, creating jobs and depressing the labor pool, thereby increasing wages. The end result has been more jobs with more workers working on a more stable, consistent basis earning good pay -- all while improving infrastructure (which is sorely needed in America) -- and stronger unions. This is only one example but an important one.

We need to save unions. How we do that is the debate. Current policies have failed. The numbers don't lie. Seventy years of declining membership is not a trend, it is a death spiral. It is time to rethink the puzzle.

Gregory Fisher is an attorney in private practice in Anchorage who primarily represents employers, businesses and contractors in employment and labor litigation. His views expressed here do not necessarily reflect the views of his firm.

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