The United States—Is the Trade Union Era Over?
The United States—Is the Trade Union Era Over?

The United States—Is the Trade Union Era Over?

September 1 st 1996

Labour-management relations are not a topic that is at the forefront of policy discussions in the United States. Major political candidates do not make speeches promising better labour-management relationships in their campaigns. The general assumption is that this area will be left to a struggle of countervailing forces where power will apply; in addition, management has all of the prerogatives unless limited by labour or government. This lack of attention shows American labour relations are in a state of disrepair, and the current leadership of the union movement in the United States is not inclined to fix them. Even if they wanted to, however, labour unions are unable to bring about the necessary changes by themselves.

Perhaps the most salient fact concerning the state of labour unions and labour-management relations in the U.S. is that membership in unions has decreased from a high of around 35 per cent of all workers in 1954 to about 15 per cent today. Although the absolute number of members increased slowly until 1980, the last 15 years have seen a precipitous drop in both the number of union workers and the per cent organized. Only 16.4 million wage and salary employees were union members in 1995, 14.9 per cent of all such workers. These figures were down from 16.7 million and 15.5 per cent the previous year.

Declining unions

The causes of this decline in unionization can be found in both structural changes in the U.S. economy as well as in labour and management behaviour. Service industries now make up over 70 per cent of all jobs in the United States, with manufacturing accounting for only about 25 per cent. Service employees (except for government services) are typically more difficult for unions to organize and are less likely to perceive benefits from union membership. In addition, many jobs have moved from the Northeast and Midwest regions of the United States to the South and Southwest, areas that have traditionally been less enthusiastic about union membership. Increased pressure from international competitors has led businesses to be very careful about granting substantial wage increases. For the most part, labour unions failed to realize that the United States economy was undergoing significant and rapid change. An aging leadership lost touch with the new economic realities, and unions were perceived to be as self-interested as corporation management.

A turning point in employer behaviour toward unions occurred during the air traffic controllers strike in 1981. In this instance PATCO union members went on a prolonged strike, although by law they were forbidden to do so. The recently elected President Ronald Reagan took the unprecedented step of firing all of those workers who were still on strike, even at the cost of severely crippling the air traffic control system in the U.S. This move signalled a sea change in attitudes toward unions. Private sector employers saw the opportunity to challenge union power and to strongly resist union organizing efforts, often with illegal action (including firing union organizers). The 1980s saw a great increase in these and other kinds of "unfair labour practices" on the part of employers. At the same time the National Labor Relations Board (which became filled with Reagan appointees) tilted more in favour of employers' interests.

Lack of vision

In response to their declining influence, labour unions in recent years have attempted several times to remake their image and increase their popularity. However, these attempts were frustrated by internal power struggles, poor leadership, and lack of vision. This year they have embarked on an aggressive campaign to put unions back in the national spotlight. Under the leadership of John Sweeney, the new president of the AFL-CIO (a federation of 78 unions and 13.1 million workers), unions have attempted to appeal to disaffected workers who have felt left out of the United States' recent economic expansion. There are new structures for organizing members and an extra $20 million budgeted for these efforts. Union members also maintained a high profile at the August convention of the Democratic party, where a quarter of the delegates were affiliated with labour unions. In addition, the AFL-CIO is spending $35 million on television advertisements critical of the policies of the Republican-controlled Congress.

The unions' renewed efforts also use confrontational techniques as a way to grab attention. In the recent Justice for Janitors campaign, protesters have locked themselves to doors, staged hunger strikes, and blocked traffic on various roadways and bridges. Although these actions have garnered the unions coverage by the nation's media, they have doubtless also stiffened the resolve of many businesses to resist union organizing efforts in whatever way possible. This focus on confrontational methods is a move away from the greater cooperation that is so desperately needed within American labour relations.

Recent legislative activity regarding labour relations in the United States has centred around two areas: striker replacement issues (where no legislation has been passed) and the TEAM Act, which deals with employee involvement teams. A look at the origin of the TEAM (Teamwork for Employees And Managers) Act provides telling insight into the state of labour relations in the United States. Under the National Labor Relations Act passed in 1935, employers were forbidden to collaborate with groups of employees in discussing terms and conditions of employment outside the context of a duly elected labour union. This provision was intended to prohibit the development of so-called "company unions," unions where the true control of the organization rested with management itself.

In the 1980s, firms began to use "quality circles" and other types of employee involvement groups in order to have their workers more involved in organizing the structure of the workplace. As these groups became more and more common, they discussed issues of health and safety, product design and other work conditions. In nonunion settings (that is, where there were no unions to give permission) any such activities that discussed the "terms and conditions of employment" were technically illegal. Several companies faced charges before the National Labor Relations Board, which ruled many of these employee involvement groups illegal, rulings that were later upheld in the judicial system. Many companies that had such groups restricted them so they would not include issues such as safety, bonuses, overtime, scheduling, health, and workplace design. However, this greatly reduced the potential for cooperation between management and labour.

In 1996 the TEAM Act was passed by both houses of Congress. This legislation would exempt employee involvement groups from the provisions of the National Labor Relations Act and permit them to "address matters of mutual interest (including issues of quality, productivity and efficiency)" provided they do not affect collective bargaining agreements. This legislation was debated in an atmosphere coloured by the recent incidents of corporate "downsizing" as well as vociferous opposition by labour unions (who felt that this would again give rise to "company unions"). on July 30, President Clinton vetoed the TEAM Act. Because of both the mistrust engendered by many corporations and the reactionary stance of union leaders, legislation to increase cooperation in the workplace did not come about.

A new partnership

There are a variety of other important trends that influence the current state of labour relations. The use of temporary and contingent employees has exploded throughout the economy; these workers generally lack power and are more prone to exploitation and manipulation by management. Despite the overall decrease in union membership, public sector unions continue to grow with almost 40 per cent of government workers belonging to a union. Perhaps the most high profile unions in the United States today are those of the players in baseball and football; their actions in the last 10 years (including numerous strikes) have tarnished the image of unions before the American people. In fact, they have done the near impossible and made many fans sympathetic to the plight of the team owners.

Recent developments within business management theory emphasize the value of the worker as well as the benefits of employee participation programs and worker empowerment as a means of improving quality. However, these new theories often still come out of a framework of total management control rather than a vision of the workplace as a work community based on cooperative relationships. At the same time, workers exist in an environment where corporations increasingly focus on downsizing, outsourcing, and hiring temporary employees. In these circumstances, trust between labour and management can be difficult to foster.

Labour relations in the United States are in need of a revolutionary change. This change is not a return to the notion of class struggle nor to a battle between two self-interested countervailing powers. If labour unions are to survive and to fulfil their calling, they need to remake themselves, not in the old model of confrontation, but instead creatively promoting the notion of the workplace as a community where both labour and management work together to serve society. Business managers must be willing to allow workers a serious role in determining the direction of the enterprise. American policymakers also need to be open to promote other institutions which foster cooperation in the workplace. There are some signs of hope, but there is a very long way to go. Christians in both labour and management have both the opportunity and obligation to provide "signposts for the Kingdom" in U.S. labour relations today.

Todd Steen
Todd Steen

Todd P. Steen is the Granger Professor of Economics at Hope College in Holland, Michigan, where he has worked since 1988. He earned his Ph.D. at Harvard University, where he studied under President Obama's chief economic adviser Larry Summers. His favorite economists are Summers, Greg Mankiw, and Bob Goudzwaard.


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