Term Paper on "Labor Unions and Their Decline Many Modern"

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Labor Unions and Their Decline

Many modern observers believe that labor unions have outlasted their usefulness in a free-market economy, where people can seek the highest compensation for their labors and know that they will be protected by a wide range of local, state and federal laws that largely prohibit the exploitation and abuse of workers in the United States today. Some of these same observers, though, might be shocked to learn how and why labor unions were formed in the first place. Today, union advocates suggest that without them watching out for the best interests of workers, it would not take long for things in the workplace to return to the way they used to be. This paper provides an overview of labor unions, a number of reasons for a decline in their membership, and a discussion of right-to-work laws and their effect on the unionization process. An analysis of the similarities between conflict theorists and functional theorists in the discussion of labor unions is followed by a summary of the research in the conclusion.

Review and Discussion

Definition of Labor Union. A labor union, according to Black's Law Dictionary (1990), is "a combination or association of workers organized for purposes of securing favorable wages, improved labor conditions, better hours of labor, etc., and righting grievances against employers" (875). Labor unions generally represent trades, crafts, and other skilled workers such as plumbers and truck drivers (Black's 1990). Unions were originally formed in response to the increasingly severe hardships that were imposed on working people through the process of industrialization (Galenson 1994). The shifts from an agrarian to industrial society resulted in many people being uprooted from their traditional homes and work. The increasingly harsh working conditions of the early part of the 20th century further accelerated the process of unionization as workers felt no other recourse. "Where the machine replaced the artisan at a relatively slow pace, where people had more time to adjust, the unions that were formed tended to be moderate in character. Where there was a rapid rise of manufacturing, more radical ideologies tended to prevail" (Galenson 133). Whether moderate or radical in nature, all labor unions in industrialized countries (with few exceptions), have experienced significant declines in their membership over the past few decades; the reasons for such declines are discussed further below.

Reasons for Decline of Labor Unions. The United Kingdom and the United States were in the vanguard of establishing trade unions 150 years ago; at this time, unions spread to other countries along with the growth of industry. The general membership trend during these early years was upward, although not always in a linear fashion.

The union movement throughout the noncommunist world appeared to be in good shape after World War II. Decline set in as early as the 1950s, but it was not until the 1980s that the retreat became widespread" (Galenson 8). According to Galenson, there have been very few exceptions to the decline of unions in the industrialized nations to date, with the following being cited as some of the reasons:

a. Employer attitudes toward organization of workers. It has been suggested that union decline had begun well before the 1980s based on a wide range of factors, many of which related to the type of industry involved (Galenson 1994). There are several difficulties in categorizing employers in different industries, though; for instance, employers in export industries tend to be much tougher in dealing with unions than those producing for the domestic market, because the former are more likely to be more concerned than the latter with the effects of rising wages and prices, for competitive reasons (Galenson 1994).

b. Unemployment tends to bring about a serious drain on union membership and finances. During periods of unemployment, union membership declines; when the economy recovers, recruiting old members back into the flock or new members becomes increasingly difficult (Abraham & Voost 2000). Further, with employment opportunities rising,.".. employees are less fearful of losing their jobs if they join unions. With incomes rising, workers are more able to pay adequate dues regularly" (Galenson 13).

c. Prevailing anti-union opinion climate of a particular state. States can enact laws that make it prohibitively expensive or difficult to unionize new employees (Abraham & Voost 2000), d. Job Restructuring. Restructuring has been an increasingly popular explanation for the decline of trade unions. "Restructuring refers to the migration of production and jobs from such basic industries as steel, automobiles, and appliances, which have been the core of unionization, to the newer high-tech industries and to the service sector" (Galenson 14). There is much evidence in support of this view as well; for example, in the U.S., the explosion in unionization that started in 1935 and raised total union membership from 3.6 million in that year to 14.3 million a decade later occurred to a considerable degree in the mass production industries and shifted the balance of union strength from construction, transportation, and coal mining to the manufacturing sector. Consequently, it is reasonable to attribute the subsequent decline in density on downward employment trends in manufacturing (Galenson 2000).

e. High Inflation Rates. Price inflation can reasonably be expected to have an adverse effect on attitudes toward unionism. According to Galenson, during periods of high inflation, everyone is affected, and the results in terms of reduced purchasing power are felt quickly. "The reaction of employees is to demand, either individually or collectively, an increase in compensation at least sufficient to maintain their living standards" (22). This in turn serves to further fuel price increases, resulting in a public backlash to unions. In addition, the unions themselves may experience adverse financial effects during periods of high inflation. "They live on membership dues, and everywhere there is a great reluctance to support increases. Organizing is expensive, and the erosion of real union income may inhibit their search for new members. In a few countries, union dues are indexed to price changes; these are the lucky ones" (Galenson 24).

f. High Unemployment Rates. Union membership has also decreased during periods of high unemployment: "Double-digit unemployment was an important factor in curbing union activity" (Galenson 25).

Right to Work Laws and New Jersey. Abraham and Roost point out that although right-to-work laws vary from state to state, all such laws outlaw union shop agreements; these are clauses in collective bargaining agreements that require employees to join the union that represents them. These authors report that about half of the states also prohibit agency shop agreements; these are clauses in collective bargaining agreements that require nonmembers to pay a fee to the union to cover the cost of representation. Proponents of right-to-work legislation maintain that the payment of dues to a labor organization by workers should not obligatory if they do not support that organization. By contrast, opponents of right-to-work laws hold that because union contracts and grievance arbitration systems cover all employees, members and nonmembers, right-to-work laws facilitate the "free-riding" phenomenon by individuals who want to receive the benefits of unionization without incurring the costs, and that this serves to further weaken already beleaguered labor unions (Abraham & Voost 2000).

Effect of Right to Work Laws on Labor Unions. According to Gall (1988), industrial relations researchers have primarily focused on trying to determine if state right-to-work laws have hampered union growth and the ability to bargain, and if so, to what extent. In his essay, "Membership and Wage Impact of Right-to-Work Laws," William J. Moore reports that such laws forbid denial of employment by reason of membership or nonmembership in a labor organization; in essence, right-to-work laws constitute a ban against the "union shop" (Moore 1980). The research has resulted in different opinions and results as to the purpose and effect of right-to-work laws. For a number of years, the prevailing perspective in the literature was that the primary purpose of such legislations "to make unions more insecure -- to slow down or halt the rate at which unions are organized, and to destroy existing unions"; in recent years, though, some authors have maintained that states pass right-to-work legislation as a way of stimulating economic development (Moore 349).

One perspective that has been advanced by Davis and Huston (1995) is that right-to-work legislation restricts the probability of union organizing (at least in the years immediately following their passage) and that this, together with the lower levels of membership that has been istorically experienced in previously organized units, serves to further reduce the level of unionization in a state. A number of studies provide substantive evidence that the effect on new organizing is the most severe of such effects, with new organization efforts decreasing between 32 and 38% in the 10 years immediately following the passage of a right-to-work law (Abraham & Voost 2000). These authors cite Zax and Ichniowski (1991) who showed that the dampening of new organizing extends to the public sector when it operates under right-to-work laws, even when those laws are favorable to unions in other areas.

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