Report: Higher Union Membership = Higher Wages = Better Economy

Seth Michaels, February 18, 2009 Workers’ freedom to form unions and bargain will be critical to rebuilding a strong economy, says a new report released today that examines the effect of unions on wages and state economies. Unions are Good for the American Economy, written by researchers Karla Walter and David Madland for the Center for American Progress Action Fund, says that increasing union rates would put more money in workers’ pockets, reversing the sharp growth in income inequality that has undermined our economy. In fact, if union membership was as high as it was in 1983, Walter and Madland suggest, employees would earn an estimated $49 billion more in wages and salaries. The report also provides a state-by-state analysis of increased union membership on wages. An increase in the rate of union membership of just 5 percent would increase total wages by $176 million in Nebraska, $503 million in Wisconsin and $852 million in Pennsylvania. These wages would be spread across the entire labor market. The essence of what labor unions do—give workers a stronger voice so that they can get a fair share of the economic growth they help create—is and has always been important to making the economy work for all Americans. And unions only become more important as the economy worsens. One of the primary reasons why our current recession endures is that workers do not have the purchasing power they need to drive our economy…what is sustainable is an economy where workers are adequately rewarded and have the income they need to purchase goods. This is where unions come in. Walter and Madland point to the disconnect between productivity and wages as a major factor in our economic crisis. Indeed, if wages had kept pace with productivity increases, rather than falling behind as they have in recent decades, average wages would be 42.7 percent higher. That’s a sizable share of the economy that workers have lost, undermining consumer purchasing power and economic security—which, in turn, hurt the nation’s entire economy in a vicious downward spiral. The massive loss to workers of the economic growth they created can be traced to a decline in workers’ bargaining power in the labor market. The solution, Walter and Madland contend, is to make it easier for workers to form unions and bargain for a fair share of the value they create. Passing the Employee Free Choice Act and making it harder for management to threaten workers seeking to unionize would be good for American workers. It would help boost workers’ wages and benefits. And putting more money in workers’ pockets would provide a needed boost for the U.S. economy. Increasing unionization is a good way to get out of our current economic troubles. In a time of economic crisis when political leaders are looking for ways to restore balance, rebuild a middle class and improve the lives of working families, this report shows that giving workers the power to form unions and bargain is essential. You can read the whole report here. 3 comments Granny on the Warpath on 19.02.2009 It isn’t just wages and benefits, it is being able to get necessary things like Family Leave and bereavement time without being hassled or having to fight for the time off. It is being able to band together and demand better working conditions and a safer workplace. It is for getting decent working hours and getting paid for those hours. It is for having your rights as an employee taken seriously and problems taken care of instead of having to keep quiet and tolerate those problems to keep your job. No Amnesty on 19.02.2009 E-Verify wouldn’t hurt either. E-Verify is nearly 100% accurate in determining the legality of people applying for jobs in this country yet it was apparently stripped from the stimulus package. It’s set to expire 3/6 without Congressional action. Contact your senators and representatives today and urge them to not only extend E-Verify but make it permanent and mandatory for ALL US employers. E-VERIFY WORKS! union friend on 19.02.2009 What a boost to the economy if people actually earned enough to pay their bills and buy some of the things they want, too. How nice it would be for all Americans to have money left over at the end of the month and actually be able to save some of it!! from AFL-CIO NOW blog