The Building Tradesman Newspaper

Friday, May 08, 2009

Right-to-work states aren't on right track, either

By Marty Mulcahy, Editor

Economically, Michigan is as sick as they come. So would instituting a union-killing, wage-lowering right-to-work law open the door to new businesses and return the state to fiscal prosperity?

Yes, according to many conservatives. At last year’s Michigan Republican Convention, delegates voted on Item No. 3 in favor of a pro-right-to-work platform. Republican Jack Hoogendyck, who unsuccessfully ran against Democrat Carl Levin last year for U.S. Senate, issued mailings in support of right-to-work. And the leading conservative think-tank in Michigan, the Mackinac Center for Public Policy, is constantly issuing pro-RTW literature that media in Michigan quickly regurgitates, often without rebuttal.

But the economic “Great Recession,” as it’s being called, is exposing the difference between conservative economic theory and reality. Jobless numbers show the economic downturn is hardly playing favorites between the 22 right-to-work states and all the other states, especially in the construction industry. It’s an equal opportunity recession.

“Michigan is a basket case for a number of reasons, but it’s not because of high wages,” said Jim Rudicil, a Muskegon native from IBEW Local 275 who has spent much of his time over the last several years for the International Union organizing electrical workers and contractors in Southern right to work states. “There are a lot of plants in the South that employed nonunion, low-wage labor that have been closing up shop and have gone overseas for wages that are even lower. Low wages aren’t necessarily keeping employers here.”

Rudicil spoke to us on the road during an IBEW organizing effort that includes Corinth, Mississippi and other areas, where he said there’s a surprisingly hard-core group of union electricians. “These guys are definitely union guys because they want to be,” Rudicil said. “There’s a pretty large group of nonunion employers here. I thought they played hardball in Michigan, but they really play hardball here. The employers are very well-connected politically.”

According to U.S. Bureau of Labor Statistics data for March released in mid-April, Michigan led the nation with the highest jobless rate, 12.6 percent. And other non-right-to-work states like Oregon (12.1 percent) California (11.2 percent) and Rhode Island (10.5 percent) were suffering high unemployment. Relatively high unemployment could also be found in nearby heavily unionized states like Ohio (9.7 percent), Illinois (9.1 percent) and Pennsylvania (7.8 percent).

In theory, the lower-wage, “business friendly” right-to-work states would have relatively low jobless rates during this recession. Some do, like sparsely populated South Dakota (4.9 percent). But the March unemployment rates in right-to-work states like South Carolina (11.4 percent), North Carolina (10.8 percent), Nevada (10.4 percent), Mississippi (9.4 percent), Florida (9.7 percent) and Tennessee (9.6 percent) help show that an anti-union right-to-work law isn’t the ticket to prosperity many conservatives claim it is.

The conservative Mackinac Center for Public Policy has for years provided the “intellectual” case in favor of right-to-work in Michigan. One of their reports issued in January by Paul Kersey, their director of labor policy, cited unemployment figures from December that showed states with right-to-work laws had an average unemployment rate of 6.2 percent, compared to 7.0 percent for states without right-to-work.

He failed to point out that right to work states with little industry, small populations, and fewer jobs to lose like the Dakotas, Wyoming and Nebraska were being compared with states that had major manufacturing operations – and major job losses.

Kersey weakly concluded: “A right-to-work law by itself doesn’t guarantee prosperity, but it does seem to help.”

Countered Michigan AFL-CIO President Mark Gaffney: The average difference in pay for workers in right-to-work states and non-right-to-work states is about $6,000. I don’t think the average Michigan family can afford that.”

Rudicil pointed out that electricians and other building trades workers in right-to-work states can’t afford that lower pay, either. For example, a handout using federal wage statistics that the IBEW gives out during organizing efforts in the South shows that Mississippi electricians earned a median hourly wage of $17.38 in 2007, ranking that state No. 49 in the nation. No. 50 was North Carolina, where electricians earned a median wage of $16.86. (Michigan was ranked No. 7 in 2007, with a median wage for electrical workers, union and nonunion, of $27.99).

Proportionally, virtually all the rest of the building trades crafts would be comparable, Rudicil said. And he also produces numbers that show the cost of living isn’t that much different between right to work and non-right-to-work states.

“Look at the wage rates for electricians in Florida ($17.51 per hour),” Rudicil said. “During the boom times, workers were building homes left and right, but they can’t afford to buy a decent home. At those wage rates, they have no disposable income. They can’t afford to buy a new car.

“It was like Henry Ford said, you’re doomed to fail if you don’t pay your people enough to buy what you make.”