With Michigan becoming the 24th state to adopt a right-to-work law, the handwriting is on the wall: If you want to attract investment and create jobs, unions are a barrier not a benefit.
Understanding why Michigan chose the right-to-work path isn’t difficult to analyze when you consider the state has an unemployment rate of 9.1 percent. In Detroit, the state’s largest city, 34.5 percent of its citizens are on food stamps, 45.7 percent aren’t in the work force and 99,702 of the city’s 363,000 homes stand vacant.
How can this be if the GM bailout created so many auto jobs? Not so fast, says Forbes, which calculated that the 236,600 GM job gains heralded by the Obama administration are a pure fantasy.
“According to the carmaker’s annual report, GM North America employed 70,000 in the United States in June of 2009 (the rest were in Canada and Mexico) and 74,500 today, for a net gain of 4,500 jobs. Of the auto manufacturing job increases, GM accounts for only 2 percent,” Forbes states.
“Taking this further, there are approximate statistics for the number of jobs lost in the closing of GM dealerships. Between June 2009 and the present, about 1,500 GM dealerships closed. The job loss due to those closings was around 63,000 — about the same as the number of GM manufacturing workers in the U.S.,” Forbes concludes.
So it’s laughable that while President Barack Obama was taking credit for the jobs created during the GM bailout in his campaign stops in Ohio, Wisconsin and Michigan, all three states have subsequently rejected trade unions and voted to become right-to-work states to curb unemployment and encourage more corporate investment.
Where are the states that are seeing a rise in the employment of autoworkers? Right-to-work states: a BMW assembly plant in Greenville-Spartanburg, S.C.; a Mercedes Benz plant in Tuscaloosa, Ala.; and Volkswagen and Nissan plants in Tennessee.
How important is a right-to-work law to job creation? Here’s what Kevin Brinegar, CEO of the Indiana Chamber of Commerce, said when his state adopted right-to-work laws: “We heard there are 30 percent to 50 percent of projects and investments that, if you’re not a right-to-work state, you don’t even get to step in the batter’s box and take a swing at. Selfishly, we would have been very happy to be the only (right-to-work) state in the industrial Midwest for a long, long time.”
After Indiana became the 23rd state on Feb. 1, 2012, to vote for right-to-work, to date over 200 companies announced they would move to Indiana or expand existing operations in the state, and 90 cited the right-to-work law as a factor.
Investors.com writes: “According to Michigan’s Mackinac Center, using data taken from the Bureau of Economic Analysis and Bureau of Labor Statistics, private-sector, inflation-adjusted employee compensation in right-to-work states increased by 12 percent between 2001 and 2011 compared with just 3 percent over the same period in forced-unionization states.
“These good wages came from good jobs. Employment in right-to-work states expanded 2.4 percent over the same stretch versus a 3.4 percent decline in non-right-to-work states.”
The American Enterprise Institute (AEI) has calculated that since the recession ended in June 2009, more than two jobs have been created in right-to-work states for every one job created in forced-unionization states (2.16 million jobs in right-to-work states vs. 1.05 million jobs in forced-unionization states).
“And when you consider the population of forced-unionization states (141.4 million) is 1.38 times larger than the population of right-to-work states (102.6 million), that means right-to-work states are creating jobs at almost three times the pace as in forced-unionization states. We could also say that forced-unionization states would have created close to 3 million jobs if those states had added new jobs at the same rate as right-to-work states over the last three years, instead of the 1.05 million increase,” AEI states.
Since 1983, the number of states in which at least 10 percent of private-sector workers have union contracts has shrunk from 42 to eight.
It’s not hard to imagine that today’s generation perceives trade unions as the blue-collar steel workers and auto builders in overalls that they’ve seen in old black and white photos. In the south, young people probably know almost nothing about unions. Unions have lost their appeal, and with it, their clout.
Today’s workers want one thing: jobs. Increasingly, that means living in a right-to-work state. When almost half of the states are turning to right-to-work options, the tide has turned. And with it comes new opportunities for 25 million unemployed and underemployed Americans.
DEC
