This Is Why Labor Day, And the Movement That Created It, Matters

Dave Johnson

Economic anxiety and inequality is contributing (as it always does) to the rise of right-wing, anti-immigrant, xenophobic and racist politics. Many of the people most hurt by the decline of unions are turning to the very politicians who want to kill unions off for good.

Economic anxiety can cause people to do things that are against their self-interest. Economic anxiety can make people resent people who are doing better than they are. How often do you hear someone complain about “the people in the damn unions” getting pay, pension plans and other benefits that they don’t get? Lately this has been especially focused on government employee, police and teachers unions, and the “cost” of their pensions, but it is an ongoing complaint generally. For some reason, it doesn’t occur to the complainers that instead of being against unions they should join a union, too.

On this Labor Day, it’s worth considering a new study that shows that these “damn unions” raise the pay for everyone, not just the union members.

Where does a lot of today’s economic anxiety originate? In a study titled “Union decline lowers wages of nonunion workers,” the Economic Policy Institute (EPI) looked at wage and union data from 1979 to 2013, and compared different regions and industrial sectors. This was a period of rapid decline of union membership, and the study looked at the costs of this decline. The data clearly showed that where unions were stronger, working people in the entire region and sector were paid more, even if they were not in a union. This is because the union jobs set the standard for the region and industry. As union jobs go away, those standards fall away.

How much more would non-union working people be paid today if unions were still strong? The study shows how the decline of unions means those working people not in unions are paid around $3,000 per year less than they would have been paid. The cost for “non-college” workers has been a 9 percent cut in pay. That is what the decline of unions has cost the American worker.

Union decline EPI 1

We talk about inequality a lot, and this study shows part of the reason why: Nonunion workers would be making around $3,000 more if unions were still strong. The EPI put it this way, “Unions, especially in industries and regions where they are strong, help boost the wages of all workers by establishing pay and benefit standards that many nonunion firms adopt.”

Here are two charts from the EPI study. The first shows that the decline of unions has hit men hardest:

Union decline EPI 2

This chart shows the boost non-college workers would receive if unions were still as strong as in 1979:

Union decline EPI 3

To what degree does the decline of unions since the late 1970s contribute to today’s support for Donald Trump and his policies among “white, working-class” voters? At least $3,000 a year worth, whether they are in a union or not.

THIS is why the labor movement that Labor Day was intended to honor matters to all of us, whether we are union members or not.

See also Richard Eskow last week: “How Much Will the War On Unions Cost You This Labor Day?

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