America’s Unionization Wave

Over the past year, much of the discourse around unionization in the wake of COVID-19 has centered around developments at Amazon Fulfillment Centers in Alabama and New York. While labor unions and their friends at the National Labor Relations Board (NLRB) may celebrate this trend of increased union activism, small businesses and employees themselves will end up suffering at the hands of self-interested unions who care more about their political influence than protecting the rights of workers or creating jobs.

To ensure workers have access to high-paying jobs and new career opportunities, workers must reject the urge to incentivize this trend by rejecting unions wherever they tempt workers with inflated promises. Additionally, the proliferation of labor unions ultimately means small businesses cannot invest in growing their businesses, denying consumers access to new and innovative goods and services.

While the union drives at Amazon have arguably been the most high-profile, almost 700 union elections had been conducted in the first six months of 2022, the most recent being at Petee’s Pie Company in New York. For comparison, in the same period last year, just 479 elections took place. The NLRB has also acknowledged this trend, stating in April 2022 that “union representation petitions filed at the NLRB have increased 57%—up to 1,174 from 748 during the first half of FY2021.”

While Amazon and other large corporations have the financial resources to compete in union elections, most of these elections are occuring at small businesses that have fewer resources to challenge unions effectively. This is particularly harmful because small businesses account for 62% of new job creation and employ almost half of the American workforce.

One of the principal claims of labor unions is that they can increase the earnings of workers. 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.”

For American workers, depressing wages means less money to purchase consumer goods, save, or achieve economic security.

Compounding the damage caused by depressed wages is the amount unions charge in annual dues. Studies have suggested that the average cost of union membership is around $400. While this may seem insignificant, for hourly workers and those on low incomes, $400 could mean the difference between economic security and economic insecurity.

Rather than having this money sent to distant unions that do not hold the same interests as those they represent, workers would be better off deciding how to spend this money for themselves. 

While unions depress the wages of workers, union leaders often enjoy lavish lifestyles. As recently as 2019, it was reported that officials at the United Auto Workers Union (UAW) spent $6,599.87 for a steak dinner which included $1,942 in liquor and $1,440 in wine and champagne. This year, Marie LeClaire, President of the American Federation of Government Employees, Local 2617, pled guilty to misappropriating $3,000 of union money to fund personal travel.

Unfortunately, much of these funds would have been provided by workers paying their annual dues for union representation.

Studies have also routinely 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 much of the public discourse covering unions has centered around the unionization attempts at Amazon Fulfillment Centers, few have paid close attention to the growing trend of unionization attempts at small businesses that are a vital part of the modern economy. Not only will this harm small businesses, but it will also hurt the very workers these organizations claim to protect.

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