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April 10, 2007
The State of the Auto Union
We no longer hear the loud, proud speechifying or witness the momentous rallies, aggressive organizing and strong political-muscle flexing. These once-common traits of one of America's most powerful movements, labor unionizing, are only whispers today after years of decline from unions' past popularity.
Congress began its spring recess last week, and when lawmakers return, one of the first issues on the agenda in the Senate will most likely be the Employee Free Choice Act (EFCA). The EFCA is a bill currently pending that would amend the National Labor Relations Act to make it significantly easier for unions to organize employees, to require binding arbitration of first contracts after 120 days, and to stiffen penalties for certain unfair labor practices, according to the EFCA Updates blog. The U.S. House of Representatives already passed the EFCA last month.
Half a century ago, about one-third of American workers were union members. Today, only about one in 10 workers belongs to a union. The number of people belonging to a union fell by 326,000 in 2006 to 15.4 million, the U.S. Department of Labor's Bureau of Labor Statistics reported earlier this year.
The fall has been most pronounced in the industrial Midwest, where hundreds of thousands of union jobs have disappeared and where unions in states such as Indiana and Ohio have seen double-digit percentage drops in membership over the last two decades.
There is a mélange of reasons for organized labor's steady decline: improved technology and productivity that requires fewer workers; more aggressive anti-union actions by employers in the era after President Ronald Reagan fired striking air traffic controllers in 1981; jobs moving overseas; and the rise of mostly non-union foreign automakers. U.S. economic growth also dilutes the urge to unionize.
Job losses at The Big Three automakers and at auto-parts makers have knocked United Auto Workers (UAW) membership; restructuring by Detroit automakers has meant the loss of tens of thousands of jobs, waves of retirements and the closing of dozens of assembly plants and facilities.
The Associated Press reports:
As foreign automakers eat away at the market share of their U.S. counterparts, unionized plants run by General Motors Corp., Ford Motor Co., DaimlerChrysler AG and their former parts operations have closed or downsized and some jobs have moved overseas. Union membership in manufacturing has fallen 1.3 percentage points to 11.7 percent, the first time statistics have shown it at a lower rate than among the national work force.
Like many unions, the UAW is struggling to keep members. From 2000 to 2005, UAW membership declined 17 percent to 557,000, according to annual reports filed with the U.S. Department of Labor (via The Detroit Free Press).
Interestingly, the UAW — which once represented 95 percent of U.S. automotive workers — is still pushing to organize workers at the foreign automakers.
Assembly plants for Japanese automakers first started appearing in the U.S. in the 1980s, "about 50 years after a 'tidal wave' of labor organization swept through U.S. plants," University of Michigan labor researcher Greg Saltzman recently told The Associated Press.
Japanese automakers, with few exceptions, have avoided organized labor at the nearly dozen U.S. assembly plants they operate. Toyota and Honda representatives say they've done little to keep unions at bay and insist their employees simply choose not to form unions. But both the timing of their arrival and even the locations they choose have been key factors.
Historically, Japanese automakers have tended to avoid union-friendly areas such as Detroit. Moreover, many build factories that already have a low average wage for the labor market, Saltzman told AP. "That means factory pay looks great regardless of whether it approached union standards." According to recent analysis from The Detroit Free Press, workers at the Toyota Motor Corp. plant in Georgetown, Ky., last year received more in pay and bonuses than UAW members averaged at domestic automaker factories for the first time.
Yet leaders of the UAW union recently said they want to organize employees at the U.S. operations of foreign automakers and their suppliers. Labor experts, of course, question whether they'll be successful, saying decent wages and factory location enable the foreign automakers to remain union-free.
AP notes:
Toyota employs 17,150 production workers at four vehicle assembly plants in the U.S., including a factory in Princeton, Ind., that employs more than 4,000, and recently announced plans to build a fifth in Mississippi. Unions represent workers at only one of those, a California factory Toyota co-owns with General Motors Corp.
Already, the UAW has tried at least three times to organize the workers at the Subaru factory in Lafayette, Ind., which will soon begin producing Camrys in a partnership with Toyota.
Suggested an IMT reader and contributor last fall:
If there were to be a plan that would commit both Union and Management to providing the same work conditions as the Japanese transplants in North America, and which would be followed by the same output from the production assembly line with comparable technological infrastructure and operating cost, why couldn't we come to a mutually advantageous agreement.
Outside of the automotive industry, Wal-Mart remains under fire by union groups who criticize the retailer for low wages and benefits and who wish to organize its workers. Others say Americans by the millions vote with their pocketbooks by buying Japanese cars and by shopping at Wal-Mart.
Spotty health-care protection and crumbling pensions are concerns for many Americans and are issues that labor frequently cites as proof of the continuing need for unions. And labor experts say there are many Americans who view unions favorably, even though they themselves do not belong to unions, adding potential for growth.
Trying to stop the erosion of organized labor, union leaders are looking beyond their core auto (and steel) industries to recruit service workers making low wages and professionals worrying about losing their health care, notes yet another AP report, which goes on to say:
The new faces of unions are immigrants working at construction sites, hospital nurses, parking lot attendants, mechanics and casino dealers — all groups who are unlikely to lose their jobs to overseas workers.
In addition to workers at auto parts plants, the UAW signed up 2,500 new members in Ohio at county jails and a juvenile courthouse in the last year.
The national union voted last year to move $60 million from its strike fund into recruiting new members.
In mid-July, Forbes recently pointed out, automakers and the UAW will begin talks on a new contract. The struggling companies will demand big concessions in wages and health care, and the union, while considerably weakened by layoffs, "will wave its intimidating $900 million strike fund." It promises to be one hell of a fight.
Earlier: Labor Pains, Union Dues
Resources
BLS: Union Members in 2006
U.S. Dept. of Labor, Jan. 25, 2007
Unions Struggle With Auto Industry Cuts
The Associated Press, March 25, 2007
1,500 will shape UAW's priorities
by Joe Guy Collier
The Detroit Free Press, March 26, 2007
UAW losing pay edge (original link no longer posted)
by Jason Roberson
The Detroit Free Press, Jan. 31, 2007
Japan Automakers Steer Clear of Unions
by Tom Murphy
The Associated Press, March 25, 2007
Labor Riddle
by Joann Muller
Forbes, April 9, 2007
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10 CommentsThe key to understanding the present state of affairs with unions and therefore the perversely named "Employee Free Choice Act (EFCA)," which is designed to deny employees free choice, is the difference between the public and private sectors. Back in the union heyday of the 1950s, when about 30 percent of all employees were union members, almost 35 percent of workers on private payrolls were unionized compared to about 10 percent of government employees. Fast forward to 2006, and 7.4 percent of private sector workers are union members compared to 36.2 percent of public employees.
Management in the private sector has done a pretty decent job keeping employees informed about labor unions. In the public sector, due in large part to political cowardice, just the opposite it true. In a way, public sector unionism is a replacement for the old patronage system. There was a time when to get a job with the government you had to make political contributions. Now the politicians help the unions pick the employees' pockets and the unions make the contributions.
April 10, 2007 1:17 PMDon't get me wrong, I'm no friend of the Unions, I am not a member, I will never be, and I see a lot of the harm that the Unions brought to the Automotive Industry.
However (because there is a however, nevertheless), like the Romans say "Give to Cesar what belongs to Cesar," and for the Unions that is to say that they brought into the middle class a lot of their members, they helped to raise the standard of living of millions of people in North America and, of course, were in large measure a contributing force to the development of the Automotive Industry.
One has to watch movies from the '50s if they are too young to remember, to realize that the line assembly worker back then was way behind in their standard of living compared to the accountant, the engineer, the car salesman and even the bank clerk.
Nowadays, 30 years plus of Union Membership secures your retirement, nice house in the suburbs, nice toys like boats, snowmobile, RV or 4-wheeler, kids in college etc. I'm sure we all got the picture. Nothing is wrong with this picture except that your regular union member doesn't want to work anymore. He just wants to retire and, in the meantime, is trying either to go on a job-bank or conserve his energy into a semi-hibernation kind of state (that is, while at work). That doesn't mean everybody has the same work ethics or lack thereof, but like one of the classics would say, "The glove fits."
This picture would be enemy #1 for any parent having the TALK with his son or daughter and trying to convince them that they have to work hard 4 years or more in college, finish with thousand of dollars in tuition debt and start a prosperous life on a $35,000.00/yr salary while union members make between $25.00 to $35.00/hour most of the time with just high school education. Try to explain that to a kid, when the logic is not there.
We don't have to elaborate why the jobs moved overseas, why the union membership is declining, etc. All these are very well documented, argued and explained. The problems start, let's say, 10 years from now when (supposedly) the Unions will not be here anymore, when all manufacturing will be overseas, when all production of goods will be considered low end job, when engineering and programming and maybe even research will be done in China and India.
Maybe then we will regret the good old days and be happy that Democrats raised the minimum wage to $10.00/hour.
April 10, 2007 3:36 PMThe only reason the auto union pay scale is what it is today is because of when it began. You bought a Big 3 auto or you did not have one... you paid a price based on what it cost to build and cover overhead plus a profit. It had little to do with what it was worth.
At the risk of pissing off some people, a production line job -- be sure to realize that I know it is difficult physically and emotionally, but it does not take a great deal of brain power or advanced education to do the same robot-assisted job several dozen times a day... reps if nothing else should make you an expert over time.
The unions managed to blackmail the manufacturers into pay rates far beyond the value added to the product by the line worker. Why, the line worker was the volume of their membership, the source of their income and the cost was passed on to the consumer and paid for in part by less equality and research investment and improvement of the basic product. Then when the voids in product quality and market mistakes were recognized by foreign competition in the very place that had a love affair with the auto... here they came!
The unions' ego did not allow them to consider the remote possibility that a competitor could succeed without them, much less make a better product without their members. Their greed in the name of concern for their membership held sway, and they have effectively killed themselves.
April 12, 2007 12:00 PMRight, John.
Don't forget to add management stupidity to give in to some uneducated (it does not take a great deal of brain power or advanced education) workers.
Or maybe also management greed that would pay anything just to keep the ball rolling and help them make the fat bonuses on consumers backs that would pay the bill.
And again the same management that made the "market mistakes."
I talked one time with an early (1985) Japanese industry representative in Cairo, Egypt, and he was taking pride in the fact that they will not sell a car but a technology. In retrospect, at that moment I can see a manager talking with pride, reverence and respect about technology. I could feel that the gentleman was honest in his statements. I am sorry, but I can't see that honesty in our industry leaders today.
This is why Toyota can hardly wait for the regulators to mandate a higher mileage per gallon while the Big Three (nottttt) are complaining.
April 12, 2007 3:12 PMI am a Union Member here in the Deep South of America and proud of it.
What no corporation (or the journalist thereof) wants the public to know is that their union busting stratigies are shooting themselfs in the foot for the long haul. Look at skilled labor, hard to find properly trained employees. This was formerly union provided, now they hire off of the streets. While unsatifactory work is often accepted by budget constrants. Overtime was created by Unions to get more of their members work. Now it is just used to make up for the lack of wage increases, and a working man's family has to take a back-seat to his job.
But really what the corporations are afraid of is GLOBAL UNIONS. This might not happen in my lifetime but as long as employers keep eching away at benifits and wages, it will happen. Think about it for a while, China unionized, with prevailing wages and benifits. These people would jump at the chance to improve their standard of living.
Watch out Wall Street!
April 19, 2007 3:01 PM
