Organized Labor's Uncertain Future

Dec. 17, 2012
Numbers alone suggest that unions' political clout seems unlikely to translate to renewed strength, except in certain sectors or isolated instances. This holds true for private-sector unions and more specifically, unions in manufacturing.

President Barack Obama swept into office for a second term in November with a big assist from the country's union workers. According to a poll conducted by Hart Research for the AFL-CIO, 65% of union members voted for Obama, a percentage that leaped to 70% in key battleground state Ohio. 

In a post-election press conference on Nov. 8, AFL-CIO President Richard Trumka made it clear that labor's political influence would not end with the conclusion of the presidential election. "Starting tomorrow -- yes, I said tomorrow! -- working families across the country will be out in communities in close to 100 events to talk to members of Congress about the coming lame-duck session and fiscal showdown," he stated.

"The election was in many ways a great night for unions and for the people they support," says John Logan, professor and director of labor studies at San Francisco State University.

Indeed, the labor movement "is feeling its oats" as a result of the election, says Gary Chaison, professor of industrial relations at the Clark University Graduate School of Management and author of five books on the subject of organized labor. "Unions were very influential in the White House victory and that's because unions can point to their ability to get out the vote. So on one hand a lot is owed to them, but the question remains: Is it likely to be paid to them?"  

See Also: Labor in the Headlines

The answer to that question can have significant impact on business as well as organized labor. Most likely, experts suggest, results will be mixed, with unions making gains in some areas and giving ground in others. And while manufacturers can expect renewed enthusiasm from unions in the wake of President Obama's successful reelection bid, less certain is whether increased activity will translate into increased might, or reverse private-sector unions' declining fortunes -- especially in manufacturing.  

Eyes on the NLRB

Any rulings that ease organizing efforts could provide momentum for union activity, says lawyer Charles Pautsch, chair of Arnstein & Lehr's Labor and Employment Practice Group. Short-term action on that front is most likely to emerge from the National Labor Relations Board, an independent agency of the U.S. government that is widely considered to be sympathetic to labor. That said, President Obama's three "recess" appointments to the NLRB earlier this year have come under fire and are being challenged in court. An appeals court last month heard arguments in the case. Opponents argue that the president lacked authority to make the appointments.

Two additional NLRB rulings bear watching. A board ruling that accelerates union elections was slated to take effect in the second quarter of 2012. Pautsch notes, "The shorter the period of time between when the petition is filed and when the election is held, the more likely it is that the union wins. Statistics show that." In addition, the agency issued a rule that requires employers to post notice advising workers of their right to organize a union. Both rules are on hold and remain mired in court challenges initiated by several industry groups. 

Despite the controversy surrounding the NLRB's decisions, Logan says "most of it has simply been tinkering around the edges" on minor issues. The more important issues, he suggests, require court action or legislation. 

He doesn't see significant legislation on the horizon. A revival of the Employee Free Choice Act (EFCA), or "card-check" bill, in the short term is unlikely, "given the absolute, implacable opposition to labor-law reform" by multiple business groups, says Logan, coupled with a Congress with one party in control of the House and another in control of the Senate. The legislation would have made it easier for private-sector unions to organize and was supported by President Obama.   

Tale of the Tape

Numbers alone would suggest that unions' political clout seems unlikely to translate to renewed strength, except in certain sectors or isolated instances. This holds true for private-sector unions and more specifically, unions in manufacturing. 

In 2011, the union membership rate was 11.8%, essentially unchanged from the previous year but down from 20.1% in 1983, according to the Bureau of Labor Statistics. That drop came despite a surge in public-sector unions, which recorded a union membership rate of 37% in 2011. Private-sector workers' union membership rate, by comparison, was 6.9%.

Manufacturing's numbers are a study in union decline: In 1973, nearly 39% of manufacturing workers were represented by unions, accounting for some 7.8 million people, according to, which references U.S. Labor Department data. In 2011, that percentage had dropped to 10.5% and 1.4 million workers. 

"Unions were very influential in the While House victory and that's because unions can point to their ability to get out the vote. So on one hand a lot is owed to them, but the question remains: Is it likely to be paid to them?" -- Gary Chaison

Globalization is a culprit in the decline of manufacturing trade unions, says Clark University's Chaison. It has taken manufacturing and its associated jobs outside the confines of the United States and exported them widely. Manufacturing unions "have not figured out how to bargain or negotiate about it," he says.

Moreover, unions' primary weapon, the strike, has lost some of its teeth. Major work stoppages, those involving 1,000 or more workers, have declined sharply since the early 1980s. Prior to 1982, the annual number of work stoppages exceeded 100, and in most instances were well over 200, according to Bureau of Labor Statistics data going back to 1947. (The bureau's data on work stoppages includes both strikes and lockouts.) By contrast, the number of major stoppages in 2011 was 19, up from 11 in 2010 and five in 2009. The longest work stoppage in 2011 (which has continued into 2012) is the lockout by American Crystal Sugar Co. of its workers represented by the Bakery, Confectionary, Tobacco Workers and Grain Millers International. Approximately 1,300 workers are affected. However, the largest work stoppage in 2011 in terms of numbers of workers impacted and lost workdays was between Verizon and the Communications Workers of America and the International Brotherhood of Electrical Workers. Some 45,000 workers accounted for 450,000 lost workdays.

Two recent examples appear to support the declining efficacy of strikes. Caterpillar Inc. (IW 500/21) and the International Association of Machinists and Aerospace Workers agreed to a six-year deal at the manufacturer's Joliet, Ill., plant after a three-and-a-half-month strike. By all reports, union members approved significant concessions, including a wage freeze. And Hostess Brands shut down completely in November following a strike by one of its unions. (See "Labor in the Headlines.") "It's a demonstration of the weakness of the strike as a tactic," comments Pautsch.  

On a related note, the lawyer says he expects the issue of pensions to join health care as a key conversation in collective bargaining, especially with the large numbers of workers retiring. "It's going to be a tough issue, and it is going to keep management and unions apart."

Even public-sector unions are having their struggles. One example of mixed results is in Michigan, where unions helped deliver a victory to Obama in the November election but union-backed legislation that would have embedded collective-bargaining rights into Michigan's state constitution met with defeat. And in Wisconsin, another state that went to Obama, an overhaul of collective bargaining for most public workers led to a membership decline in two teachers unions, enough so they are considering merging, according to Associated Press reports. 

Nevertheless, says Phillip Wilson, president of the Labor Relations Institute, "Manufacturers must be careful not to get complacent because of these trends. Unions remain very powerful politically and they still spend hundreds of millions of dollars each year to organize manufacturers."

About the Author

Jill Jusko

Bio: Jill Jusko is executive editor for IndustryWeek. She has been writing about manufacturing operations leadership for more than 20 years. Her coverage spotlights companies that are in pursuit of world-class results in quality, productivity, cost and other benchmarks by implementing the latest continuous improvement and lean/Six-Sigma strategies. Jill also coordinates IndustryWeek’s Best Plants Awards Program, which annually salutes the leading manufacturing facilities in North America.

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