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John Schmitt on struggling unions and the promise of a new era

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MATTHEW PALEVSKY, JOURNALIST: SEIU, with nearly 2 million members, is one of the largest unions in the United States. But SEIU, along with most unions in America, could be facing difficult times. Not only has union membership been declining steadily for over three decades, but the economic uncertainty caused by the current recession could erect new barriers to unionization. To understand the current state of unions in America I spoke with John Schmitt, senior economist at the Center for Economic and Policy Research.

JOHN SCHMITT, SENIOR ECONOMIST, CENTER FOR ECONOMIC AND POLICY RESEARCH: If you go back to the end of the 1970s, about 25 percent of all workers in the United States were in a union at the time, and not coincidentally, about 25 percent of the workforce was also manufacturing back then. So we’ve seen two really big changes over the last 30 or so years. On the one hand, we’ve had a big decline in manufacturing. And on the other hand, we’ve also seen a big decline in unionization in the country. They’re related, [but] one doesn’t necessarily imply the other. But the big decline in the main base of unionization, which is manufacturing, has certainly hit unions hard. Meanwhile, we haven’t created as many union jobs in the service sector, which has been growing a lot, and that’s been part of the problem too. I think that the recession is both a challenge and an opportunity for the labor movement. It’s a challenge because it’s going to put the squeeze more on workers, it’s going to lead to layoffs, and it’s going to lead to economic pessimism. But it really is also an opportunity, because, among other things, what a recession—particularly a recession of a serious magnitude—is going to show is that the economic system that we have is not working well for everybody. So it’s going to give people an opportunity to question whether or not people in charge really know what they’re doing or not. Recessions can work both ways in terms of the impact on a union. On the one hand, the sectors that are going to be affected typically—manufacturing—are fairly well unionized, so there can be a big impact in a negative sense on union membership rates. On the other hand, when workers feel the squeeze, that’s a time when they can most frequently turn to unions to try and help to address their problems. So there could be a push-back in the other direction. So it’s hard to know, and a lot of it actually really depends on the organizational structure and organizational state of the union movement. The other issue is this coming year there’s a big debate in the United States about to take place over something called the Employee Free Choice Act, which is a piece of legislation that would make it much easier for unions to organize workers in the private sector. If that legislation passes, say, early in 2009 and is signed into law by the next president—because certainly the current president isn’t going to sign that kind of legislation—there’s a chance that unions could see a real boost in their membership, because it would be much easier, legally, to organize workers. In particular, the biggest problem is that there are almost no penalties for employers who break the law. So, for example, one of the most common techniques that employers use is to pick out the two or three most prominent workers involved in a union-organizing campaign and simply to fire them. That’s against the law, and employers know that, but they also know that they won’t be found guilty for two or three years, long after the union organizing drive has been wiped out, and the typical fines are something on the order of two or three thousand dollars. So for employers to make this decision is a complete no-brainer. I think one of the biggest ideological victories for the right over the last 30 years is the complete lowering of expectations that Americans have for their rights and the kind of standard of living that they should enjoy. And I think that we see that played out on the union issue, that workers that 25 or 30 or 50 years ago would have had a strong sense of what their rights were and that their rights were being violated have been persuaded that the economy is tough, globalization is tough, there’s not much we can do, and if we’re, you know, losing some of our rights, well, you know, this is really just beyond our control. And I think that is both a cause and a symptom of a lack of union strength in this country. If we had a strong union movement, I think that it would be the kind of thing that can provide some kind of guidance to workers and workers in unions about what their rights are and what kind of expectations they should have about the way the economy functions. The other huge benefit of unionization from a perspective of workers in the United States is that unions do tend to be very supportive of a broad social agenda that benefits workers more broadly. Unions, for example, were at the center of the struggle to have an eight-hour workday and a 40-hour workweek. That benefited not just union workers, obviously; it benefited everybody. Similarly, many unions now are pushing to have a national health insurance system of some sort or other. So the more political-economic clout unions have, the more political clout they’ll have and the better situation there’ll be for pressing for things like paid parental leave or mandatory, legally sanctioned, legally required vacations from employers and other kinds of benefits. Denmark has an unemployment rate that’s lower than the United States. Workers in the very bottom of the Danish labor market make about $20 per hour by US standards. The economy’s doing just fine over there, and the unions aren’t getting in the way. Similarly, we had a much higher unionization rate in the United States from the end of World War II to about the end of the 1970s, and the national growth rate of the US economy was double what it’s been from that period to the present. So there’s not an argument, I think, that unions inherently get in the way of rapid economic growth. There’s not even an argument that they in the past have done that in this country. On the contrary, when we have strong unions, we have rapid growth. And in the period that we’ve seen a decline in unionization rates, the growth rates have actually fallen off.


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John Schmitt is a senior economist with the Center for Economic and Policy Research in Washington, DC. He has written extensively on economic inequality, unemployment, the new economy, the welfare state, and other topics for both academic and popular audiences. He received an M.Sc. and Ph.D. in economics from the London School of Economics.