Needed labor reform or driving a hard bargain?

May 31, 2021

Economics Professor Bruce Pietrykowski shares what the federal PRO Act aims to do, the historic role of labor unions in the workplace and what the research data show about organized bargaining.

Graphic shows the fight at the federal level about the PRO Act, the role of unions
Graphic shows the fight at the federal level about the PRO Act, the role of unions
Graphic by Violet Dashi; U.S. Capitol Building image taken by Brook Ward

President Joe Biden’s Protecting the Right to Organize (PRO) Act, which would make it easier for workers to unionize, is at a stand still in the Senate after passing in the House.

Some are saying that if passed, the act would hurt the economy and take away worker independence. Others say it’s needed to protect workers from unfair labor practices and to have the ability to bargain for fair wages.

With strong rhetoric on both sides of the PRO Act, Economics Professor Bruce Pietrykowski, the author of the book Work whose long-term research area is workforce labor, shares what the act aims to do, the historic role of labor unions in the workplace, and what the research data shows about organized bargaining.

Question: What does the PRO Act aim to do, specifically?

Photo of Professor Bruce Pietrykowski
Photo of Professor Bruce Pietrykowski
Professor Bruce Pietrykowski

Bruce Pietrykowski: Studies show that if labor unions were as strong today as they were in the 1970s that all workers — both union and non-union — would be making more money and that the wealth inequality gap wouldn’t be so large. With the income gap between rich and poor widening, Americans see unions as an important institution worth supporting, according to a recent Gallup Poll.

The PRO Act would clamp down on the ability of management to interfere with organizing campaigns — for example, prohibiting employers from holding mandatory meetings in which employers try to persuade workers to vote against unionization. The PRO Act also would prohibit employers from permanently replacing workers who go on strike. In addition, it would assess monetary costs on companies, executives, and boards of directors that violate labor laws.

Q: Why was there a shift in the role of unions?

Pietrykowski: While President Biden is outspoken about being pro-union, this represents a major shift away from anti-union policies begun under President Reagan. Reagan’s administration was notoriously lax in enforcing labor laws. In the early 1980s, companies were given a green light to aggressively oppose unionization drives through intimidation and the dismissal of union activists. Since that time, unions have encountered barriers to organizing new workers and the percentage of unionized workers has greatly declined — 25% in 1980 compared to about 10% in 2020.

The PRO Act’s goal is to help to redress the imbalances that have eroded the right of workers to join unions and the right of unions to effectively represent workers by giving workers and unions more protections against abuses by employers and makes it clear that workers who want to form a union should be able to do so. 

Q; What about workplaces who have workers who vote against unions, like we recently saw at an Amazon warehouse in Alabama?

Pietrykowski: If workers don’t want unions, they don’t need to have them. The act provides protection for people at workplaces that do.

As for Amazon, the company vigorously fought against the union.  Workers received text messages, leaflets were placed in bathrooms, and workers were required to attend weekly meetings where company representatives would tell them the unions were going to negatively impact the workers. For example, they would tell workers that the union could force you to go out on strike — but neglected to add that the union members themselves are the ones who vote whether or not to strike. 

Another factor is looming automation. For Amazon workers and others, there may be fear that voting for a union may accelerate the pace of automation. Automation is definitely an issue that unions — and our workforce as a whole — will need to creatively confront in the coming years. 

However, it is good to know that in unionized plants, union leaders often play a role in managing the pace, scale and type of automation installed in a plant. In companies that have a strong union history, automation is introduced to reduce worker injuries, while still retaining the judgement and skill of the workers.

Q: Many people have argued that in a capitalistic society, people can choose to work for a different employer if they feel the environment is unfair or they can gain more in-demand skills. As a labor economist, what’s your take on that?

Pietrykowski: Growing up in Cleveland, I witnessed the ravages of deindustrialization, racial inequality, and wealth amidst poverty. The notion that the inequality I witnessed was mainly the result of individual choices and individual talent rang hollow to me. It propelled me to critically explore the field of labor economics.

Most economists look at the world as the outcome of individual choices, freely made, leading to the best possible outcome for all. As an unconventional economist, I was trained to look at the world through the lens of power and inequality. 

Q: Let’s talk about research data. Do unions help reduce inequalities? 

Pietrykowski: According to an Economics Institute Study published in April 2021, research shows that unions reduce racial disparities in wages and raise women’s wages, helping to counteract disparate labor market outcomes.

The research shows the economic effects of unionization on individual workers in general is pretty clear too. Unionized workers have higher wages and benefits — on average, a worker covered by a union contract earns 10.2% more in hourly wages than someone with similar position and experience in a non-unionized workplace in the same sector — and better working conditions overall. 

In addressing income inequality, economists often default to the skills and education solution, arguing that if people only chose to upgrade their skills and get a degree, they could raise their income by moving into better-paying jobs. What gets left out of this story is that income inequality could also be reduced if the wages at the bottom of the income distribution — the wages of COVID’s essential workers, for instance — increased from poverty wages to living wages. Unions can play a role here.  

The original slogan of the “Fight for $15” movement for a $15 minimum wage was “Fight for $15 and a Union.” If anything, the COVID crisis has shown that essential work is often where acknowledging each other as human beings is part of the service being provided. This type of work is not going to be easily automated. It’s here to stay and the workers who perform it deserve to earn a decent, respectable living.  

Q: So there are societal and worker benefits to the PRO Act passing. What’s the benefit if you are a business?

Pietrykowski: From the business perspective, it is sometimes true that unions can depress company profits because collective bargaining by its very nature is intended to redistribute revenue from profits to wages. But there are benefits to companies too — research indicates that unionized workers in the U.S. are more productive workers. This can translate into higher profits and higher wages, which often reflects what happens when companies take a high-road strategy. Many of these companies are found on “Best Companies to Work For” lists, which is also beneficial for employee recruitment. 

Some of these high-road companies are unionized. Others may have adopted the high-road strategy in order to avoid unionization. In either case, the result is a better working environment, a respected company reputation, and knowing your employees are earning a wage they can live on.

Interview by Sarah Tuxbury. If you’re a member of the media and would like to interview Professor Bruce Pietrykowski about this topic, please drop us a line at UMDearborn-News@umich.edu.

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