State Governments Are Just Adding to Labor's Woes

Like many cash-strapped individuals trying to get by in the current economic climate, state governments are being forced to tighten their financial belts. In Wisconsin, Ohio and elsewhere, local legislatures are doing that by taking aim at government employees, preparing bills that would slash the bargaining rights of public unions. But the large protests against those moves have led to a Greek chorus of commentary about what's next for organized labor in the U.S.

American labor unions have been in decline for a half-century now -- and virtually the only large unions still growing are those in the public sector. "In the private sector, only unusual occupations like professional athletes, as well as and lawyers and physicians, are showing union growth," says Cynthia Fukami, a professor of management at the University of Denver's Daniels College of Business.

Fukami attributes the decline in the labor movement to a wide spectrum of factors, one of the biggest being America's evolution from a manufacturing-based to a service-based economy. "Unions aren't very strong in organizing service-based workers, knowledge workers," she says.

The Rise of "Right to Work" States

Also, relatively new federal laws on issues such as due process and workplace discrimination now provide protections to all workers that were once available only to union members. But those legal protections against unfair treatment are limited and often have loopholes that favor the employer over the employee.

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And laws on the books in 22 states -- mostly in the South, the Midwest and in major agricultural regions -- make them so-called Right to Work states. "A Right to Work law secures the right of employees to decide for themselves whether or not to join or financially support a union," says the National Right to Work Legal Defense Organization. According to its website, the group has been "defending America's workers from the abuses of compulsory unionism since 1968."

Right to Work legislation has also led to a geographic shift in where many private firms now have their operations. "If a company wants to avoid labor unions," says Fukami, "it closes up and moves to the South. Like R.H. Donnelley, the printing company, moving from Chicago to Dallas. . .or Gates Rubber moving from Denver to Tennessee."

Some of this controversy is certainly political, and harks back to other government vs. union confrontations, such as when President Reagan fired thousands of striking air-traffic controllers in 1981. It may also be due to a growing public perception that unionized government employees don't work as hard as people in the private sector, are impossible to manage and have job security to boot.

A State Can't Declare Bankruptcy

But unlike private firms facing fiscal problems, financially stressed states have limited options. "One way that profit-sector companies have dealt with this is to declare bankruptcy," says Fukami, "and the bankruptcy makes the union contracts null and void. Continental [Airlines] did this years ago. But a state can't really declare bankruptcy, so they just cut, cut, cut -- and the unions have contracts saying you just can't do that unilaterally. They're fighting for their rights, which they're entitled to according to federal law. "

While some analysts see the current confrontations in Wisconsin and elsewhere as signs of the death of organized labor in the U.S., Fukami isn't so sure. "If business and government treat their workers poorly, then there will be renewed interest in labor unions," she says, "because it's a way of us achieving the same kind of rights that we have as citizens in the United States, in the workplace."