Are labor unions still relevant? Will they continue to shrink? Will they reinvent themselves? What will they look like in 10, 15, or 20 years? Labor unions have gone from representing 20.1% of the workforce in 1983 (when the government began to track the data) to 10.7% of the workforce in 2017. Union membership in the public sector is 34.4 % of the workforce compared to the private sector rate of 6.5%.

There has been a lot of debate about the decline of labor unions.  Some argue that increasing competition in traditionally regulated industries, increasing deregulation in unionized industries (such as trucking), and just a desire to not be in unions led to the decline.  Other commentators believe that these factors played a role, but add still additional causes including smaller labor costs for non-unionized firms compared to unionized firms, anti-union campaigns by companies including the hiring of permanent replacements for strikers, and President Reagan’s firing of the air traffic controllers. see Reagan’s speech here).

Regardless of the reasons for the decline in membership in the past, the future of unions is uncertain. With the Janus ruling by the Supreme Court this year (see my blog post), it is likely that many public sector unions will lose members. However, Janus will certainly not be the end of unions. In fact, we are likely witnessing a shift in the union movement which may possibly even lead to a resurgence of some unions and their membership.

Organizing by Apps

One aspect of unions that has yet to reach its full fruition is labor organizing by app.  There has been a lot of ink spilled about apps that could help workers organize, but this is an aspect of organizing that has yet to find its mark. In These Times talked about the need for a labor app that could help with organizing in 2015. Walmart has told workers not to download an app that allows their members to communicate.

However, with all the talk of organizing by app most organizing still begins because workers at a company are dissatisfied and feel that their voices are not being heard. Of course, paid labor organizers do attempt to organize big companies where they hope to make inroads. For example, the UFCW has been trying to organize Target for years. One Target store in New York voted down a unionization attempt this past week. It would have been the first Target store to unionize if it had voted to do so. Time will only tell what the future of organizing will look like, but currently labor organizing is still happening the same way that it did 20 or 30 years ago. Labor organizers stand at the plant gate and distribute literature and go door-to-door in an attempt to get people interested in the union.

The Return of the Strike

As unions seek to exercise their muscles and return to their former days of representing large swarths of the American workforce we may again experience, and indeed already have experienced, the return of the strike. Around 5,000 members of the United Steelworkers are voting or have voted on whether to give their union leaders the ability to call a strike. Three of the local unions that represent some of the steelworkers voted unanimously to grant their union leaders the authorization to strike. In addition to the steelworkers, 12,000 Marriott workers in 9 cities may authorize their union leaders to call a strike if negotiations break down further. The staff for 25 hotels in downtown Chicago have gone on strike.

Why are so many workers considering the strike again? The success of the 2018 teacher union strikes is surely part of the reason. The teachers in Arizona received a 20% raise over the course of the next 2 school years.  Teachers in Oklahoma got a $6,000 pay raise and those in West Virginia got a 5% pay raise. As a result of the stunning success of the teacher’s unions in raising wages for their members, it seems that many other unions are willing to take a gamble to see whether they can see similar increases. But the teachers are in the unique position of being virtually impossible to replace.

Union Pensions

Any resurgence of unions and union organizing in the country may eventually be met by many different obstacles. Perhaps the most obvious obstacle is the growing pension crisis. In 2016, public pension in the states were $1.4 trillion in debt, the 75-year unfunded liability for both state and local pension plans was $3.5 trillion, and the median return for a public pension plan by a state was 1% which is well below the median assumption of 7.5% return still used by most pension funds. In other words, the pensions are broke and are going deeper into debt. The loss of these pension benefits will inevitably hurt the reputations of the unions that ran the plans and the public sector unions. It will also hurt the public opinion of these groups. It is not clear how the unions respond to this loss, but for now many seem content to ignore the problem or seek a government bailout.

Conclusion

Unions face a number of challenges if they hope to change and evolve for the modern workforce. Currently, the Janus decision and the teacher strikes from last year have created an environment where unions are seeking to do more organizing to maintain their relevance. However, if they wish to successfully evolve they must do more than merely strike. They have to learn to adapt to organizing with modern technology and confront their mistakes in the past and failings for past members. The most troubling sign for unions is the rapid loss of their share (by percentage) of the private sector over more than 30 years (16.5% of the workforce in 1983 to 6.5% in 2017). Clearly, unions were either unable to stop unionized businesses from closing, were not effective at convincing workers to join or at least to stay union members, or workers in the private sector simply did not want unions (unions are especially struggling with recruiting younger members because a unionized workforce generally rewards employees based on tenure rather than merit and young workers are the first to be laid off if the workforce shrinks). Whatever else may be said about unions the loss in the share of the workforce should be a wakeup call to unions.

 

The information provided in this blog is for educational purposes only and is not legal advice. If you need legal advice, then you should speak with a lawyer about your specific issues. Every legal issue is unique. A lawyer can help you with your situation. Reading the blog, contacting me through the site, emailing me or commenting on a post does not create an attorney-client relationship between any reader and me.

The information provided is my own and does not reflect the opinion of my firm or anyone else.