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"Every government interference in the economy consists of giving an unearned benefit, extorted by force, to some men at the expense of others."

Ayn Rand

Nobody's listening.

RANDOM FACTS ABOUT LABOR UNIONS

By
Neal Boortz
@ May 22, 2009 7:36 AM Permalink | Comments (21) | TrackBacks (0)

The Heritage Foundation has a great analysis on how labor unions affect jobs and the economy.  What I've done is pulled just a few facts that you should know about these unions.  Read the linked study for more information.  This one needs to be framed and put on a wall.  Ready?  OK .. here is what labor unions do for American business:

 

  • Studies typically find that unionized companies earn profits between 10 percent and 15 percent lower than those of comparable non-union firms.

 

  • Some unions win higher wages for their members, though many do not. But with these higher wages, unions bring less investment, fewer jobs, higher prices, and smaller 401(k) plans for everyone else.

 

  • Final union contracts typically give workers group identities instead of treating them as individuals. Unions do not have the resources to monitor each worker's performance and tailor the contract accordingly. Even if they could, they would not want to do so. Unions want employees to view the union--not their individual achievements--as the source of their economic gains.

 

  • Consequently, union contracts compress wages: They suppress the wages of more productive workers and raise the wages of the less competent. Unions redistribute wealth between workers.

 

  • A better summary of the economic research is that unions do not increase workers' wages by nearly as much as they claim and that, at a number of companies, they do not raise wages at all.

 

  • In essence, unions "tax" investments that corporations make, redistributing part of the return from these investments to their members. This makes undertaking a new investment less worthwhile. Companies respond to the union tax in the same way they respond to government taxes on investment--by investing less.

 

  • Research shows that unions directly cause firms to reduce their investments. In fact, investment drops sharply after unions organize a company. One study found that unionizing reduces capital investment by 30 percent--the same effect as a 33 percentage point increase in the corporate tax rate

 

  • The balance of economic research shows that unions do not just happen to organize firms with more layoffs and less job growth: They cause job losses. Most studies find that jobs drop at newly organized companies, with employment falling between 5 percent and 10 percent.

 

Wonderful stuff, don't you think?  Really makes you want to go to work for a unionized company.  Not.

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What others are saying

  • I HAVE talked to union leaders
    As a past member of a couple of different unions in different industries, I can tell you that the assertions made by Heritage and Neal mirror my own experience.

    In the places where I worked, the unions always told me to "slow down, you're making the rest of the guys look bad". They also did everything to make sure that productivity suffered, in order to 'force' management to hire more workers. When a layoff loomed, they encouraged equipment damage as a means of getting the layoff canceled, or as a means of intimidation against any action by the company that the union did not favor.

    When I left the union under the 'right to work' laws, I was told that I was making a mistake, because the union would not protect me.

    I saw drug addicts and alcoholics being protected by the unions. I saw thieves and incompetents protected by the union. I saw no such protection of productive workers, some of whom were unjustly dismissed, while the union remained silent.

    My decision to resign from the union came partly as a result of union leaders ordering us to vote Democrat, and partly from an incident in which a shop steward told me to lie to management in order to save the job of a careless worker who damaged an airplane because, in the words of the shop steward, "there's no way this guy is gonna pass the drug and alcohol test".

    I can remember doing my job well enough after 2 years that 20-year men were routinely asking me for help when they had a problem they couldn't solve. None of them could understand why, even though I helped them, I was unhappy because I was paid less. One commented to me, "You think that just because you are a better mechanic, you should be paid more? You're working at the wrong place!"

    Once, the company, reeling from losses of mechanics to competing companies, offered a $4 per hour raise to us in order to stop the bleeding. The union refused the raise, unless all the unskilled workers got the same raise, even though there was no shortage of these workers.

    Some might argue what Heritage and Neal are saying, but you can't argue with what I have seen with my own eyes.
    By Tim Ernandes @ 05/25/09 08:59:20 AMreport abuse
  • Who really needs a Union...
    Unions kill industries and corporations, and stfle innovation- companies that are unionized tend to stagnate.

    But I think it would be great if Microsoft became a Union shop-

    Then maybe I wouldn't have to learn a new OS every two to three years.
    By Gerry Owen @ 05/23/09 10:28:46 AMreport abuse
  • huh?
    Who said that companies reward the better workers? This is just not so. I have known many times when the better workers are payed less and less productive workers get more. Companies simply will not reward you for hard work!! Of course there are exceptions but for the most part this is why Unions are needed. They hire you at one rate of pay...then a year later they hire someone else at a higher rate and ask you to train them! Face it Business is Dishonest at best! The Union is needed to protect the average worker from the dishonest businesses.
    By mharrell @ 05/22/09 09:52:59 PMreport abuse
  • Your'e right UFCW IS A JOKE
    They took in 5.00 a week from over 1 million members and couldnt secure a decent contract. But it was better than no contract since I do have a retirement from the kroger company. I have no retirement from any other company that I worked for that wasn't union.
    If you have a contract that defines your job and what youre supposed to do, you don't have to do anything else. Do you think neal does commercials without being paid?
    When you work without a contract you do whatever youre told to do just like a slave. Right to fire insures that youll like it too.
    If wsb told neal that he had to empty his own trash, he would cry that it wasnt in his contract (if it wasnt).
    By Mike @ 05/22/09 04:09:44 PMreport abuse
  • Unions
    Funny how when it's done by business it's called "price fixing," but when the unions do it, it's called "collective bargaining."
    By MeFein @ 05/22/09 04:06:11 PMreport abuse
  • Unions
    Overall Neal, I am with you and also believe the need for unions expired decades ago. That was until my wife became a school teacher here in Georgia (non-union) several years ago. Basically, pay is measured by years of service and level of education. Not sure, but this would most likely mimic a union scale too where there is no merit on accomplishments. Here is the “scope of work” clause in the 2009/2010 teacher contract:

    It is understood and agreed that Employee will be assigned to the duty of teaching or other professional duties at the school and grade, or in the subject-matter area which Employee prefers, and for which Employee is certified, whenever it is practicable to do so. HOWEVER, THE SCHOOL DISTRICT RESERVES THE RIGHT AT ALL TIMES TO EFFECT A TRANSFER TO ANY OTHER SCHOOL AND/OR ANY OTHER PROFESSIONAL POSITION.

    Not worth the paper it is printed on.

    Example:
    Not enough busses in the county, so the school system shares busses between elementary, middle and high schools and staggers the school hours to accommodate. Well, the kids are out at 3:15PM, some of the busses routinely show up at 4:30PM and 5:00PM. Teachers are required to handle afternoon bus duty once a week, for the ParaPros (aides) are paid hourly and the county does not have the budget to pay the extra hours. Not fair for the kids who get home after 5:30PM or the teachers who still have to complete work for the next day. Not mention several child fatalities where the bus picks the children up at 6:15AM – well before sunrise. In one child fatality, a teenager had to cross a major highway to board the bus. That is a pretty high cost to improve the bottom line.

    This is the short list of idiocies throughout the public school system in our county. Would a union help? As much as I dislike unions, as collective group they might be able to at least provide a scope of work in line with teaching rather using a salaried professional for babysitting.

    Overall, our state continually ranks among the lowest in the nation. Studies have proven that more money is not the answer, for private schools continually outperform public schools on half the budget and resources. I am not in the teaching profession, but in the business world there would be consequences for repeated failure (usually job loss, out of business or both). Again, would a union help or just make it worse with more bureaucracy?
    By cd @ 05/22/09 03:51:21 PMreport abuse
  • More garbage trolls - antipov
    Antipov, be honest, you're actually Stan Gable or one of the other conservatives posing as an ignorant liberal. The little blue text in Boortz's comments are call links. Click on them with your mouse. You'll see the article and all the references you need at the bottom.

    Calling your post "sophomoric" would be an understatement.
    By John Galt @ 05/22/09 02:51:02 PMreport abuse
  • Neal is right about this
    Mike, been there done that. UFCW 555 member while working a part time job 6PM-11PM. UFCW has been a joke amongst the workers due to the track record of UFCW. If 30 months is okay while waiting for full union medical benefits works for you, then UFCW is for you. Like starting at minimum wage ($8.40 in Oregon) regardless of your experience?

    I started at a non union store in Washington State, several steps higher because of experience and had 90 days to full benefits. My transfer to a district with union stores resulted in loss of benefits for 18 months (except for prescription) and the added cost of union dues.

    My experiences with unions have been less than savory. You are better on your own, provided you think for yourself.
    By Ken in Oregon @ 05/22/09 02:31:30 PMreport abuse
  • SOURCES
    As usual, opinions without sources, anyone can make things up. SOME STUDIES is not citing a source. This is sophomoric at BEST
    By @antipov @ 05/22/09 02:12:37 PMreport abuse
  • Unions are just like Cancer
    I once worked for a printing company that was part union and part non-union. I was in the non-union part. We had proofers who not only did their jobs, but also strived to learn other jobs to improve themselves all for less than $9 per hour. The union side had proofers who sat on their buts refusing to do anything that "wasn't their job" for over $25 per hour. The union's refusal to budge on negotiations led to the entire company's demise. As with Cancer leaching the life out of it's host, a union will suck the life out of a company until it is dead, even though the death will bring about unemployment for union workers as well. That, my friends is true greed.
    By Tim @ 05/22/09 02:11:06 PMreport abuse
  • Ever talk to a union guy yourself?
    Have you ever spoken with a union representative about what the unions do and have done that is good?
    If you can't think of anything good that the unions have done then you probably don't know as much as you think you do.
    Pick a union and call the office, someone will be glad to talk to you.
    Tell them this crap that Neal spouts and I know that you will hear a thoughtful response that you aren't ready for.
    Think for yourself, don't let neal do the thinking for you.
    Do it today.
    By Mike @ 05/22/09 01:13:54 PMreport abuse
  • Thank you
    I had long wondered if there was any research showing the companies that are unionized do less weel than non-union companies. Putting it closer to home, I am willing to pay somewhat extra to go to Publix, a company that is owned by it's employees, where employees act friendly than to Kroger, which is unionized.
    By Kevin H @ 05/22/09 12:49:39 PMreport abuse
  • But on the other hand-
    Unions work well within the public sector where the evil profit margin is not a factor. Good argument for privatizing government jobs.
    By carlos @ 05/22/09 12:19:14 PMreport abuse
  • Unions
    Only represent full time employees even though they collect dues from ALL employees!
    By Conservative American @ 05/22/09 11:12:03 AMreport abuse
  • Nothing in there on how much unions reduce productivity.
    That's what made me swear off any job where I had to join a union, it was the only job I was ever told to slow down on outside of concerns for safety or accuracy.
    Having to hunt down a union electrician to flip a well known circuit breaker while several thousand highly paid people stand idle on an assembly line for 30-40 minutes is not only expensive, but flat out stupid. They couldn't pay me enough to suffer that environment.

    I'd rather get big raises and bonuses for increasing productivity, efficiency, and profit. The day goes by too fast when you're trying to beat the clock, rather than trying to make it move.
    By CowboyUp @ 05/22/09 10:38:27 AMreport abuse
  • Unions are a socialist disease!
    Great article/link. It just confirms what a lot of here already knew. Too bad the mainstream media won't cover it.

    While they were once a necessity in this country to protect workers from unsafe working conditions, they are no longer needed. They rob from both the employer and the employee. The only people who benefit from unions are the union bosses, everyone else gets screwed.
    By Ronaldo @ 05/22/09 10:25:09 AMreport abuse
  • Unions
    Really makes unproductive workers want to go to work for a unionized company. Sounds like a win-win situation for everyone. Not.
    By Anon. @ 05/22/09 10:03:02 AMreport abuse
  • Sounds great
    Why do people defend these Mobs again?
    By Bret @ 05/22/09 09:21:38 AMreport abuse
  • This is great!
    I'll pass this along to the boss.
    By Joyce M/Blythe @ 05/22/09 09:15:46 AMreport abuse
  • Sure I want to work for the union
    If I survive the layoff, I get to live higher on the hog. If not, I collect unemployment until the union finds me a new boss to leach off....
    By anonymous @ 05/22/09 09:15:10 AMreport abuse
  • That goes without saying...
    In a capitalistic system unions are toxic. I really cannot understand why people wouldn't just put the effort toward getting a better education to make themselves more marketable rather than trying to strong arm companies because of their laziness. That is what it comes down to. If those people would just put the same effort they put into the unions into bettering themselves there would be no use for unions at all. This is a fact. Companies don't mind paying an employee more if the extra dough is justified. If you have a better education you will always be better at the same job as someone with less education. This is an extremely easy concept to grasp. It is for this reason that I believe that ANYONE that thinks that unions are a good idea is either mentally handicapped or just completely ignorant.
    By Ivan @ 05/22/09 08:51:24 AMreport abuse
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