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.”
United States Attorney Andrew M. Luger announced on March 3, 2015 the sentencing of JEFFERY JOHN PLZAK, 52, to 22 months in federal prison for felony false statements in connection with prevailing wage violations. PLZAK pleaded guilty on July 8, 2014, to one count of False Statements and was sentenced on March 3, 2015, before Judge Patrick J. Schiltz in U.S. District Court in Minneapolis, Minn. Read more »
Social media is one way that trade unions are reaching people, especially when it comes to a dispute with management, or in a local case, with the owners of a regional shopping mall. Beginning in the spring of 2014, several unions, spearheaded by Laborers Local 563, took issue with Ridgedale Mall in Minnetonka over what the unions said were safety issues along with some sub-standard wage levels. Read more »
Recent Discovery of Open, Unguarded Skylight Shows Continued Disregard for Public, Workplace Safety.
While holiday shoppers look for gifts this Black Friday at Ridgedale Center, union members say the mall’s owners should expect coal in their stocking due to lax construction safety practices that have repeatedly put shoppers and workers at risk. Read more »
Dan Gustafson, Jr., who began his career as a plasterer and ended as leader of Minnesota’s labor movement, has been honored with a plaque at the Minneapolis Labor Center.
Union officers and members mingled with Gustafson and his family at a reception Aug. 21 at the Union Bank & Trust, located in the labor center, 312 Central Ave. SE, Minneapolis. They admired a large plaque with an image of Gustafson that is displayed in the lobby of the labor center. Read more »
With two new stadiums in the works and $1 billion in new state infrastructure investments – as well as jobs-creating regional improvements like the Destination Medical Center here – the Building Trades unions in Minnesota are riding a wave of momentum.
That momentum is at stake in elections up and down the Nov. 4 ballot, speakers warned delegates to the Minnesota Building and Construction Trades Council’s annual convention at the Kahler Hotel last week. Read more »
Maria Meza watched intently as Robbie Luukkonen, a journeyman member of Bricklayers Local 1, installed ceramic tile onto a makeshift practice wall. When Luukkonen had finished the demonstration, Meza picked up the tools and tried tiling for herself.
This is the way Meza, who graduated from St. Paul Johnson High School in the spring, learns best. “I’m a hands-on type of person,” she explained. “I’m not the type of person to sit behind a computer all day.” Read more »
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 »