Southern Auto Corridor > Issues > Summer 2009

Summer 2009

Editorial

The Made in the South Label is increasingly Non-Union

This issue of SB&D has a strong manufacturing flavor. We wanted to show our readers that the manufacturing sector is far from dead in the American South. In fact, if you read the cover story that begins on page 26 you might even buy into our argument that while the manufacturing sector has lost jobs in the region like everywhere else, the overall value of the industry is increasing somewhat dramatically here, making it a critical component to the South's economy.

One of the reasons why the future looks bright for manufacturing in the South is the uptick we've seen in the migration of plants to the region -- relocations and consolidations -- from other parts of the U.S. combined with the South being the location of choice by a wide margin for foreign-owned producers. Of course, that is at the expense of other regions and states in the U.S. and in particular at the expense of unions in non-right-to-work states such as California, Washington, Ohio, Michigan, Illinois and Indiana.

Let me preface the rest of this column with this: we are not anti-union. Unions have their place, specifically if workers are being exploited for one reason or another. However, in the future if there ever was a time that historians point to when discussing the death of unionism in this country, it might just be 2008-2012. Considering what has occurred in 2008 and so far in 2009, there is no question in our minds that the future of unionism is in doubt. It's our belief that the remaining pulse left in the unions will all but flat line in three short years.

The reasons behind our argument that unions are all but dead can be explained by a few things that we've noticed during this recession. For one, the prospects of the Employee Free Choice Act are looking bleak to say the least. Secondly, unionized plants in this country have closed at an alarming rate compared to the closure rate of non-union plants during this recession. Furthermore, many of those closed union plants were simply consolidated to non-union facilities in the South and offshore.

The last reason we think unions are facing extinction is fear itself. Do you not think that business leaders, politicos, the Machinists union and the people of Washington State are not scared of the possibility of Boeing setting up its first large aircraft assembly plant outside of the Puget Sound in a non-union environment? Damn right they are. The source of the fear is simply losing your job.

Labor Day was celebrated a few weeks ago. And not too long ago, 40 percent of salaried wage workers in the private sector were union members. Today, that figure is seven percent and even lower in the South. According to many experts, the last time we saw an economy like this was during the Great Depression. Those hard times that began 80 years ago drove workers together in an effort to keep their jobs and the founding of the United Auto Workers occurred in 1935. Many other unions emerged during and right after the Depression.

Fast forward to the Great Recession and you have a different attitude present in the American worker. Global competition and the severe recession have created an "every man for himself" mentality. And more than not, the fear of losing one's job has created that mentality. If anything, unions have not been very good lately at helping their members keep their jobs. While the Great Depression may have been the birth of unions in this country, the Great Recession may be what historians point to as the death of unions in this country.

Mike Randle
mike@sb-d.com

Editorial

In Good Times and Bad, Right-to-Work States have Lower Unemployment Rates

Support for the Employee Free Choice Act, or Card Check as it is more commonly called, has been unprecedented in its candor. Supporters have actually admitted that the prospective legislation -- which would make it easier for unions to organize in non-union environments, specifically in right-to-work states in the South -- would "level the playing field" between the South and the more unionized economic environments of the Midwest and Northeast.

Never before have we heard economic development officials and politicos from outside of the region admit that for their economies to compete more favorably with the South, their way of doing things must actually be adopted by the South. Why don't we just turn that around and instead of offering up the South forced unionism, make all states in the U.S. "right to work" states, or, adopting labor practices that are clearly winning as the South's are? It is acutely obvious to us that if that happened, the U.S. in general -- including the Midwest and Northeast -- would be so much more competitive in job creation and economic development in general, particularly as the U.S. competes with other developing nations such as China and India.

Basic, yet critical data supports our argument that "right to work" for all U.S. states would make them – therefore the entire country -- more competitive than if we adopted the policies of card check, which are essentially the current policies of non-right-to-work states.

For example, currently, the average unemployment rate for all 28 non-right-to-work states is 9.16 percent. The current average unemployment rate of the 22 right-to-work states, almost all of which are in the South and West, is 8.24 percent, or nearly an entire point lower. Not a single year in this decade (even in the good times) have non-right-to-work states averaged a lower unemployment rate than right-to-work states. The following are average unemployment rates in non-right-to-work states vs. right-to-work states in selected years this decade.

Average Unemployment Rate