Building a Union Business
Unions Are Good for Business, Productivity and the Economy
According to Professor Harley Shaiken of the University of California-Berkeley, unions are associated with higher productivity, lower employee turnover, improved workplace communication, and a better-trained workforce.
Prof. Shaiken is not alone. There is a substantial amount of academic literature on the following benefits of unions and unionization to employers and the economy.
- Economic Growth
- Product or service delivery and quality
- Solvency of the firm
- Workplace health and safety
- Economic development
During the period 1945-1973, when a high percentage of workers had unions, wages kept pace with rising productivity, prosperity was widely shared, and economic growth was strong. Since 1973, union density and collective bargaining have declined, causing real wages to stagnate despite rising productivity. This decline in union density and bargaining contributed to the current financial crisis and severe recession, as unsustainable asset appreciation and easy credit too the place of wage increases most workers were not getting.
According to a recent survey of 73 independent studies on unions and productivity: “The available evidence points to a positive and statistically significant association between unions and productivity in the U.S. manufacturing and education sectors, of around 10 and 7 percent, respectively.”
Some scholars have found an even larger positive relationship between unions and productivity. According to Brown and Medoff, “unionized establishments are about 22 percent more productive than those that are not.”
Product/ Service Delivery and Quality
According to Professors Michael Ash and Jean Ann Seago  heart attack recovery rates are higher in hospitals where nurses are unionized than in non-union hospitals. According to Professor Paul Clark, nurse unions improve patient care by raising staff-to-patient ratios, limiting excessive overtime, and improving nurse training.
Another study looked at the relationship between unionization and product quality in the auto industry. According to a summary of this study prepared by American Rights at Work:
“The author examines the system of co-management created through the General Motors-United Auto Workers partnership at the Saturn Corporation…The author credits the union with building a dense communications network throughout Saturn's management system. Compared to non-represented advisors, union advisors showed greater levels of lateral communication and coordination, which had a significant positive impact on quality performance.”
Several studies in have found a positive association between unionization and the amount and quality of workforce training. Unionized establishments are more likely to offer formal training. This is especially true for small firms. There are a number of reasons for this: less turnover among union workers, making the employer more likely to offer training; collective bargaining agreements that require employers to provide training; and finally, unions often conduct their own training.
Professor Shaiken also finds that unions reduce turnover. He cites Freeman and Medoff’s finding that “about one fifth of the union productivity effect stemmed from lower worker turnover. Unions improve communication channels giving workers the ability to improve their conditions short of ‘exiting.’”
Labor’s enemies assert that unions drive employers out of business, but academic research refutes this claim. According to Professors Richard Freeman and Morris Kleiner, unionism has a statistically insignificant effect (meaning no effect) on firm solvency. Freeman and Kleiner conclude “unions do not, on average, drive firms or business lines out of business or produce high displacement rates for unionized workers.”
Workplace Health and Safety
Employers should be concerned about workplace health and safety as a matter of enlightened self-interest. According to an American Rights at Work summary of a study by John E. Baugher and J. Timmons Roberts:
“Only one factor effectively moves workers who are in subordinate positions to actively cope with hazards: membership in an independent labor union. These findings suggest that union growth could indirectly reduce job stress by giving workers the voice to cope effectively with job hazards.”
The benefits of unions in terms of safer workplaces are hardly new. According to one most recent study, unions reduced fatalities in coal mining by an estimated 40 percent between 1897 and 1929.
Unions also play a positive role in economic development. One good example is the Wisconsin Regional Training Partnership, “an association of 125 employers and unions dedicated to family-supporting jobs in a competitive business environment. WRTP members have stabilized manufacturing employment in the Milwaukee metro area, and contributed about 6,000 additional industrial jobs to it over the past five years. Among member firms, productivity is way up--exceeding productivity growth in nonmember firms.”
It’s a multimodal transportation hub poised to serve the Twin Cities Metro. It’s an architectural jewel in St. Paul’s booming Lowertown district. And according to the results of a new study, the renovated Union Depot has been – and continues to be – an engine for job creation and economic growth. Read more »
Utilizing the first state budget surplus in seven years, state legislators pushed the value of a package of public infrastructure investments passed during the 2014 Legislative Session to over $1 billion.
Gov. Mark Dayton signed off on the construction bill May 20, green-lighting projects across the state that will create “millions of work hours” for union members in the coming years, according to Harry Melander, president of the Minnesota Building and Construction Trades Council. Read more »
After 41 years of distinguished union service, Jim Brady is retiring as president of the Laborers District Council at the end of this month. Todd Pufahl, the LDC's current Legislative Director, will step into the job, leading the District's 12,000 members.
The LDC will hold an event commemorating Brady's work and his legacy on Jan. 23. (See below) Read more »
by Union Advocate - Members of Pipefitters Local 455 call out Gerdau for contracting with a Georgia firm to provide mechanical workers for an expansion project at its mill in St. Paul.
State and local taxpayers are backing a $50 million expansion project underway at Gerdau’s St. Paul steel mill with a package of incentives, grants and forgivable loans. But members of St. Paul Pipefitters Local 455 say the project has left local workers out in the cold. Read more »
Looking for an oasis of bipartisan comity? A top-shelf group of public officials, corporate leaders and lobbyists will be attending a “transportation infrastructure summit” today. Though coming from different parties and representing different interests, they will echo each other on one basic truism: America must invest more in its infrastructure if it expects to grow its economy, lower unemployment and regain its competitive footing globally. Read more »
Striking Workers Visit Medtronic to Ask One of the State’s Biggest Companies to Stop its Relationship with CretexSubmitted by JohnSee on Thu, 08/15/2013 - 3:28pm
Multiple delegations of striking union workers from Cretex and business agents from Laborers Local 563 made a visit to three Medtronic properties in Fridley, Mounds View and Brooklyn Center, Minn. today to ask the world's largest medical technology company to cease doing business with Cretex until the strike is settled. Read more »
Starting at 6:00 a.m. Monday morning close to 100 workers are now locked out their jobs in Detroit Lakes. According to an employee that wishes to remain anonymous, 90 some Snappy Air Distribution came to work Monday morning only to find they no longer had a job.
Snappy Air Distribution is a union shop and on Friday, March 8 at 3:00 p.m. the contract between the Sheet Metal Workers Union and Snappy was rejected by vote. Read more »
By a unanimous vote on Thursday, Chicago’s City Council passed one of the strongest “wage theft” laws in the United States. The move was hailed by labor activists, who’ve long complained that wage theft — not paying workers what they’re legally owed — is one of the easiest crimes to get away with. Read more »
The following post is from Katie Gulley, Regional Program Manager for the BlueGreen Alliance in Minnesota. Monday, I had the pleasure of visiting International Brotherhood of Electrical Workers (IBEW) Local 343’s Training Facility in Rochester, MN with U.S. Deputy Secretary of Energy Daniel Poneman. Read more »