Everyone Benefits from the Right to Work

 

 In addition to Right-to-Work (“RTW”) Laws being morally correct, there are advantages to the RTW Laws for both employees and employers.  News coverage usually points to the obvious advantages to businesses of letting employees choose whether or not to join a union, but leaves out the advantages to the employees.  A recent survey of CEO’s ranked states in which they would like to do business on a variety of measures.  All of the states in the top 10 were RTW States.  Not one of the states in the bottom 20 was a RTW State.  In the ‘worst states for jobs’ list, New Jersey came in 45^th out of 50.   For most expensive states, New Jersey came in 5^th highest, above even New York.

Economists have noted that RTW States have more labor force flexibility, faster economic growth, higher employment, greater inward migration, lower living costs and higher real compensation.  In the ten RTW States rated the best in the nation, private sector employment increased 10.6% from 2000 to 2010, while in the 10 compulsory-unionism states rated the worst in the nation, which included New Jersey, employment increased just 1.9% over the same period.  It is obvious the increase in employment and greater labor force flexibility, due to the absence of strict union rules, together with lower cost of living in RTW States, helps employees.  RTW Laws are win-win laws for both employees and employers.  See, “More ‘Raspberries’ For Compulsory Union Dues,” National Right To Work Newsletter (“NRWN”), June 2112, p.1.  New Jersey has suffered net outward migration and its high taxes, high living expenses, forced-union dues and excessive regulations are all part of the cause.

Overall, the Commerce Department’s Bureau of Economic Analysis (the “BEA”) reported that from 2000 to 2011 private-sector, nonfarm employment increased 12.5% in RTW States, while in forced union dues states such employment only increased 3.5%.  Thus, the increase in employment in the RTW States was nine percentage points higher than, or over 3.5 times as great as, in forced-union dues states.  “Right to Work States Have Superior Job Growth,” NRWN, Oct. 2012, p. 6.  All of the bottom ten states in job creation in that period did not have protection for their employees from forced-union dues and monopoly union representation.  Id.

The benefits of the new RTW Law in Indiana are already showing up in a stronger economy.  When Indiana was a forced-union dues state, it was one of the worst economic states in the country by several important metrics.  From 2000 to 2010 the BLS determined that Indiana’s private-sector payroll employment declined by 9.1%.  Just two other states, both forced-union dues states, did worse during that time period.  The Midwest’s forced-union dues states as a group experienced a dismal decline of 9.8% during that period.  However, during the same decade, the five Midwestern states with RTW Laws actually experienced a slight increase by an average of 0.5%.  “’We’re Absolutely on the Right Track,’” NRWN, August 2012, p. 5.  During the first three months after Indiana’s new RTW Law took effect, Indiana’s private-sector payroll employment increased by nearly 73,000 or 3.0%, according to the BLS.  The gains were above the national average for that period.  Id.  By September, the Labor Department data showed that the number of new private-payroll jobs in Indiana has increased by nearly 100,000 or 4.1% since Indiana’s RTW Law went into effect.  “Indiana Right to Work Statute Is Working,” NRWN, Sept. 2012, p.5.

Furthermore, the job growth is likely to continue.  Dan Hasler, the head of the Indiana Economic Development Corporation reported that fifty-seven companies have Indiana investment projects in the pipeline, which will bring $1.6 billion in new investment into the state.  Hasler also stated that many companies had informed his agency that Right to Work would be a factor in their decision on whether to locate jobs to Indiana.  Id.

Twenty-three states have passed RTW Laws.  Tennessee was one of the first, passing its law in 1947.  As a result Tennessee has been attracting new domestic and foreign businesses for years and become a major auto manufacturing hub.  Nissan opened its Smyrna, Tennessee plant in 1983 and moved its US headquarters to north of Nashville in the mid-2000’s.  It recently added 1,000 employees to its Smyrna plant and plans on adding 1,300 more in 2013.  Toyota has a parts facility in Jackson, Bridgestone Tire has its American headquarters in Nashville, and Volkswagen opened its only US plant in Chattanooga in 2010.  Even GM is reopening its old Spring Hill, Tennessee Saturn plant for additional production needs.  Tennessee has mainly been spared the mass layoffs, plant closures and bailout that affected the Detroit area.  Many groups credit the fact that Tennessee is a RTW State as the key advantage that saved it the pain that other parts of the country suffered.  Sean Higgins, “Tennessee Auto Industry Thrives Without Unions,” Investor’s Business Daily, 3/5/12, p. A1-A6.

RTW States not only have better job creation, they also have better compensation growth for the employees.  According to Commerce Department data, private-sector compensation (wages, salaries, benefits and bonuses) fell by 0.7% from 2001 to 2011 in then forced-union dues Indiana, while it rose by 6.4% nationwide.  Indiana and the six other Midwestern forced-union dues states experienced an aggregate real private-sector compensation decline of 2.7% during the same time period.  During the same decade, the five Midwestern RTW States achieved an increase in real private-sector compensation of 13.0%. “Indiana Right to Work Statute is Working,” Id.  Superior job growth and superior compensation growth in the RTW States equals double win for the employees.  Effectively, under current Federal Law, an employer in a unionized company cannot offer merit-based pay increases or bonuses unless the union gives its permission or there is a federal finding of an “impasse.”  Mark Mix, “Union boss bargaining hurts our most productive workers,” The Washington Examiner, May 11-12, 2012.  In a country that became great because it was a Meritocracy, this Federal Law is downright Un-American.

Employees seem to appreciate that they are better off without being represented by a union.  In Wisconsin the membership in many of the state’s government unions plummeted within the first year after the adoption of Act 10, allowing employees to choose not to be in a public sector union.  According to the Wall Street Journal’s May 31 issue, membership in the Madison AFSCME Council 24 dropped from 22,300 to 7,100.  “Wisconsin Voters Rebuff Government Union Brass,” NRWN, July 2012, p.1 at p.2.  In another example, Nissan’s Tennessee plant workers rejected joining the UAW by roughly 2-1 in 1989 and 2001 and the UAW announced and then dropped an effort to unionize a foreign auto maker’s US plant last year.  “Tennessee Auto Industry,” Id. at 2.

Right to Work Laws even affect the school-aged populations.  Apparently, parents believe that they would rather raise their children in RTW States for a variety of reasons, including more job opportunities, better compensation, workforce flexibility, better chances for job advancement, lower cost of living, better living environment, non-union schools and lower taxes.  Whatever the reasons, the top seven states with the biggest gains in school-aged population from 2000 to 2011 were all RTW States.  Six of the seven states that lost the most school-aged children were forced-union dues states.  Katrina-ravaged Louisiana was the only exception of a RTW State that lost school-aged children among those seven states.  In the aggregate, RTW States’ K-12 populations increased by 1.87 million or 9.2% since 2000, while forced-union states have seen their school-aged populations drop by 1.21 million or 3.7%.   Naturally, states that are losing school-aged children are also providing fewer opportunities for teachers to obtain employment, keep their jobs and achieve career advancement, and vice-versa in states that are experiencing growth in the population of school-aged children.  “Right to Work = Teacher Job Opportunities,” NRWN, Sept. 2012, p.3.

An example of union action being detrimental to the teacher employees took place in Ohio.   There a union referendum was able to repeal Ohio’s new RTW Law, by flooding the airwaves with misleading ads claiming Ohio’s new RTW Law would lead to massive layoffs of teachers.  In reality, the public sector layoffs in Ohio were much worse than they would have been had the law not been repealed, since the law did not reduce the money spent, but only permitted more prudent allocation of the money.  Furthermore, the Ohio layoffs were much worse than those that occurred anywhere in Wisconsin, where the RTW Law survived union challenges.  For example, the Cleveland School Board laid off 17% of the district’s school teachers in April 2012.  “Government Union Lobby Remains Formidable,” NRWA, July 2012, p. 3.

Many polls have consistently shown nearly 80% of the Americans who are regular voters support the Right to Work principle.  “Hoosiers Deliver Clear Message to Congress,” NRWN, Feb. 2012, p.3.  “[S]cientific surveys regularly show rank-and-file Democrats and Independents, as well as rank-and-file Republicans, overwhelmingly oppose compulsory unionism.” Id.  The American people feel that forced unionism is morally wrong and that it is also a detriment to the economy.  “Major Right to Work Victory in the Midwest” Id. at p.2. The Republicans would do well with the general public to support the right of employees to work without being forced to pay union dues.

Obama’s ‘‘Recovery” Remains Anemic

The Obama Administration announced that 171,000 new jobs had been created according to its October jobs report, but that the unemployment rate had ticked up to 7.9%.  Obama quickly claimed that the report showed that his policies were working, that it was not time to turn back and that he deserved four more years.  However, in the real world, Obama’s policies have caused the worst recovery since Hoover and Roosevelt used similar policies to turn a stock market event into the Great Depression.  Nonfarm payrolls remain 4.27 million below their old high.  In a normal recovery, such as the Reagan recovery of the 1980’s, that number would be much higher by this point in a recovery.   The labor force participation rate remains near an all time low, so that the unemployment rate does not look as bad as the real conditions in the economy.  “Obama Jobs Record Failed In Every Way,” Investor’s Business Daily (“IBD”), 11/5/12, p. A1.  Under Obama, 7.8 million people dropped out of the labor force and stopped looking for work.  Without the dropouts, the unemployment rate would be 10.6%.   According to the Bureau of Labor Statistics (“BLS”) since Obama took office nearly one million more workers are working part time because they cannot find full-time employment.  Id.   Nearly 23 million Americans are unemployed, underemployed or have left the work force, despite Obama’s trillion-dollar stimulus and other alleged stimulus programs.

In addition to the low labor force participation rate, only 59% of the adult population is working, which is below where it was when Obama took office, even though the percentage normally rises during a recovery. This low participation rate is a sign that Obama’s deliberate policies of encouraging dependency are working, and that the economy is not working.   People are signing up for social security disability at record levels, partly because of the poor economy and partly because the Obama Administration has lowered the standards for disability and encouraged people, who are coming off of 99 weeks of unemployment insurance, to apply for Federal disability.  Id.  Meanwhile, there has been an explosion in the number of people in poverty.  Id.  The BLS reported that those who are working have seen their real median weekly earnings drop 5% during the four years of the Obama Presidency.  Id.  Moreover, the median income of all households has dropped by 8%, hammering the middle class.  The number of people on food stamps has increased by 15 million to 47 million. “A Dire Four Years of Deficient Leadership,” IBD, 11/5/12, p. A18.  Obama’s policies have produced an anemic recovery with economic growth and job gains slower than in almost every other recovery on record.  Had Obama’s “recovery” merely matched the post-World War II average, eight million more people would be employed and the GDP would be $1.2 trillion higher. Id.

Lou Dobbs commented that in the 23 million unemployed, underemployed and no longer looking, there are now 5 million people unemployed for 6 months or more.  He also said that the average family income has gone down by some $4,900 under Obama and that there was a 1% increase in the African-American unemployment rate from 12.3% to 13.4%.  “The O’Reilly Factor,” Fox News Channel (‘FNC”), 11/2/12.   It seems that Obama’s policies have hurt the very people he claims to be helping.  Hispanic and African-American unemployment is high and going higher.  The jobless rate among black youth approaches 30%.  “A Dire Four Years of Deficient Leadership,” Id.  The price of gasoline has doubled because of Obama’s policies against fossil fuel.  Food and energy prices have gone up and health insurance premiums have gone up by $2,500 instead of down by $2,500, as Obama promised.  In addition, Obama has passed taxes on items that will hurt the middle and lower classes more than the rich.  Obama promised to cut the National debt by 50%, instead he has increased the National debt by 50% from $10.6 trillion when he came into office to over $16 trillion now.  He has put us on a path to potential insolvency.  Id.

Keith Hall, a senior research fellow at the George Mason Mercatus Center and former BLS commissioner, said, “We’re getting some growth, but it is not recovery growth.”  “Hiring Rises In Oct., Led By Low-Wage Retail, Food Service,” IBD, 11/5/12, p. A1.  He also said that monthly gains need to exceed 250,000 to qualify as recovery growth and the economy would have to expand by more than 3%.  Id.  Furthermore the concentration of jobs has been in low-paying retail and food service jobs. Id.

In his speech in Colorado Springs, Colorado, Romney referred to the economy as “stagnate” and that Obama had promised that at this time unemployment would be 5.4%.  However, Romney pointed out that Obama has fallen 9 million jobs short of that promise.  Romney continued by saying that we have almost forgotten what a real recovery looks like.  Romney stated he will limit government rather than limit Americans’ dreams.  While, if the President is reelected, he will promote government and kill jobs.  “American Election Headquarters,” FNC, 11/3/12.

Romney actually has a five point plan to get the economy growing rapidly again.  The plan includes developing our oil, natural gas and clean coal, including on Federal lands, and approving the Keystone Pipeline.  Romney will make the United States North American energy self-sufficient within eight years.  The plan also calls for actually cutting the Federal Government by 5% on day one, not just reducing the rate of growth.  He will issue waivers to every state from Obamacare, so that businesses will not be afraid to hire.  He will review all of Obama’s regulations with the view to ending the ones that hurt jobs.  Romney will support school children and their parents and not the unions.  He will support school choice, so that children can attend the schools that are successful and not be locked into the zip code school system we now have.  Id.  It is time to get a REAL RECOVERY going by electing Mitt Romney on November 6^th.