PTI Labor Research
  Power Through Information  

Latest News - December 2014

December 26, 2014
Imagining A Different Future For Labor Unions
Source: FORBES
By: Adam Ozimek

The Fight for $15 protest movement has provoked a lot of discussion of the future of labor unions in the U.S. It’s not entirely clear to me how this protest-based model is really a sustainable future for unions. If the goal is simply pushing states and cities for higher minimum wages, then okay. But if the goal is to pressure firms to accept traditional labor unions, then I don’t think this is going to  go very far. Higher minimum wages may make union workers relatively cheaper, but I don’t think this is going to lead to much of an increase in unionization. So if you’ll indulge me, I’d like to engage in a rather loose, un-detailed, imaginative exercise of actual alternative models for labor unions in the U.S.

In labor economics, unions have been described as having two faces: worker voice, and monopoly. I believe the path forward is focusing on the worker voice face. Unlike many union critics, I don’t think such an exercise can be done well by simply asking “How can you weaken unions?” Instead, I think the key question is “How can you increase the value that unions create in society?” And unlike many critics, I think they potentially have a role to play. Such a focus on value creation would take you away from protesting for higher pay as a means to an end. Instead the focus would be on generating useful services rather than simply increasing bargaining power.   I believe this is necessary given globalization and the growing mechanization of work. Many would be loathe abandoning the feel-good pose of demanding profits be grabbed and put into wages, but ultimately I don’t think that’s a winning game.

So what value creating roles could unions play? First, I can imagine them serving as catalysts for worker-owned companies and high-wage business models. It seems almost daily someone cites the work of Zeynep Ton showing that higher wages for low-skilled jobs are a good business strategy and will pay for themselves. I don’t find this persuasive as a generalization, but perhaps there are more places this could work than it is currently being used. Figuring out where this does work is an entrepreneurial problem, and unions could help entrepreneurs make this happen by providing capital, advice, and a variety of other services they need. In addition, it’s easy to imagine union-backed private equity companies who buy out big firms and experiment with higher wage models. Or union-backed venture capital funds that create majority worker-owned startups to compete with companies like Uber. In general, I see room for unions to help put into action the positive claims that there are profitable opportunities out there that also benefit workers.

Another place where unions could conceivably create value is providing human resources services to firms. Unions could administer unemployment insurance, and in some countries this is actually done. They could also provide workers with health insurance that they kept regardless of their employers. Right now, the tie between employment and health insurance means that if you want to start a business of reasonable size you have to become not only an expert in your industry, but also an expert in healthcare. Imagine, instead, if firms contracted with union labor corporations that handled all of that. This is a common model for low-skilled temporary work, but could it be extended more broadly and done by unions?

As I mentioned, I don’t see much of a future for unions as legally binding labor monopolies to create bargaining power against firms. However, I do think they could help individual workers bargain better by providing information on what their salaries should be given their experience and role in a firm, and by finding better outside opportunities. These new unions could require members turn over salary information in order to build a giant dataset that helps them in this regard. Imagine, for example, a union employment counselor who tells a worker: “Most accountants with your experience and skills make 15% more, and by the way here are five job openings in your area that you are qualified for and that pay more”.

Finally, I could see unions providing consumer advocate services for their workers. If your union is making sure you have good insurance coverage and other benefits, maybe they can also negotiate terms with banks, phone companies, etc for their workers. The world is an increasingly complex place, and having specialists on your side to ensure you aren’t getting screwed by the small-print could be helpful when it comes to expensive decisions like hiring a plumber, buying a washing machine, or getting home mortgage, car, or even payday loans.

When it comes to the details of making any or all of these hypotheticals become reality, there are a lot of complexities and I’m not a labor lawyer who can tell you specifics about which laws require changing. But if we’re going to imagine a different future for labor than the current course we are on, I believe ideas like these should be discussed and generally I’m not seeing much of that.



Latest News

Deliver your message anywhere, anytime.
Campaign Websites reinforce your campaign message in a format that preserves employee anonymity


Union Awareness Program
PTI Labor Research has been obtaining and analyzing union activity and petitions for over 20 years. We have the largest and most extensive research data in the country which has been utilized by thousands of companies, labor lawyers and consultants.


About Us          |          Services          |          News          |          Clients          |          FAQ          |          Contact Us

© 2009 PTI Labor Research. All Rights Reserved