Last week, labor organizers at an Amazon fulfillment center in New York pulled off what many thought was impossible; the successful unionization of workers at a company known for its deep hostility to trade unions. However, while left-leaning politicians celebrated the outcome of the vote, the slim margin of victory of just 523 votes and 57% turnout did not present the overwhelming victory organizers had hoped would materialize.
While organizers in New York were successful, a re-vote at a fulfillment facility in Alabama is too close to call, with “no” votes leading by 118 votes. Around 400 votes are currently being contested.
While the election results must be respected, the decision to unionize one facility could spark a larger wave that will imperil the welfare of workers’ unions that they have vowed to protect. Workers must not be drawn by the siren song and the false promises of unions becoming increasingly irrelevant in American labor.
Over the past few decades, labor unions have become increasingly marginal players in the American labor market. In 2021, just 14 million, or 10.3% of, wage and salaried workers were members of labor unions. According to the Bureau of Labor Statistics, the number of union members had fallen by 241,000 compared to 2020 and is just part of a broader decline in union membership from the 1980s when 20% of workers were members of a union.
The decline in unionization is, perhaps, evidence that workers no longer see unions as generating value for them and their careers. Moreover, it would add credibility to the belief that labor unions are dinosaurs that have outlived their usefulness in a modern economy.
While labor unions say they can increase wages for workers, the evidence suggests they actively depress wages, leaving workers worse off financially. Moreover, while unions depress wages, union leaders often enjoy lavish lifestyles. Back in 2016, The American Action Forum found “statistically significant evidence that an increase in a state’s union membership rate is associated with a decrease in the growth rate of total wage earnings for all workers in that state and particularly for those in small- and medium-size business establishments.”
AAF also found that “For all workers, a one-percentage-point increase in the union membership rate is associated with a 0.20 percentage point decline in the total wage earnings growth rate.”
The financial picture for labor unions is bleaker when annual dues are factored in. Studies have suggested that the average cost of union membership is around $400. While this may seem an insignificant amount, for hourly workers and those on low incomes, this $400 could mean the difference between being able to afford essentials.
The data is clear: labor unions not only depress workers’ wages but also make it harder for them to make ends meet.
Studies have also shown that labor unions depress job creation, making it significantly harder for workers to find jobs. Studies have routinely shown that rather than creating jobs, as labor organizers claim, unions lower employment “between 5 and 10 percent.” The loss in jobs is attributable to unions increasing costs for businesses, making it harder for them to either grow or maintain current staffing levels.
With fewer jobs available, workers will have fewer opportunities to either enter the workforce or seek opportunities elsewhere and grow their careers.
While labor unions have a tempting siren song of better pay, improved conditions, and more jobs, the empirical evidence provides unquestionable evidence that they are a detriment to American workers. Unions depress job creation and make it considerably harder for workers to make ends meet as a result of lower wages and exuberant annual dues.
Workers must not be tempted by the siren song.
This was published in the Economic Standard.