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Labor Unions are Inevitable

Labor Day is brought to you by those who brought you the weekend – Organized Labor.

When I worked in Germany for a short time in the 1990s, labor relations often came up. Some of my colleagues were envious of the US system while most hated it. All of them, however, had a term for what they understood our core principle to be – “Hire and Fire”. The idea of an “at will” employee with no job security in law and no loyalty by tradition was alien to Germans.

Compared to the nations in the developed world which we compete with, our position is unusual. It’s a bias at the foundation of our system – a natural outcome of the demand for a flexible workforce. This is also likely to change as more and more skill is needed to do the jobs of tomorrow.

German Strike

German metalworkers on strike.

For many reasons, unions seem somehow old-fashioned in the US today. Participation is about 1/3 what it was at its peak sixty years ago. Stranger yet, when people talk about bringing back the 1950s, usually in coded language, union membership is rarely part of the shtick. There was a time when the entire industrialized world was more or less on the same path.

 

It once seemed natural to us that workers would organize. But my German friends were right – there is a difference at the core.

Union participation for various industrialized nations over time.

Union participation for various industrialized nations over time.

American industry has always favored flexibility in the workforce over anything else. If times are good you hire more people, when times are bad you fire them. It seems very stark to hear a foreigner describe it in these terms, but no one ever said the German language was subtle. American jobs are made as simple as possible and the workers are just one more gear in the big machine – changed out as necessary.

German industry, like most of the industrial world, has always heavily favored the development of skill instead. Skilled workers are more expensive, so this system demands high productivity. It also demands loyalty and stability. A worker with skills can pick up and find another job, so you better make them happy enough to stay.

Thus one small bias at the core of industrial philosophy changes absolutely everything.

VW Chattanooga - a very modern, efficient auto plant.

VW Chattanooga – a very modern, efficient auto plant.

Once you have a bias towards skills, some amazing thing start to happen. For one thing, it becomes natural for workers to organize. It’s not only about good pay and the benefits which make employees happy, either. The development of skills and the process of training in new employees or developing broader skills in general often falls to the union.

Skilled workers are always quick to organize. The first known industrial action was taken by skilled masons tired of the crappy conditions and pay imposed by Pharaoh Ramses III in 1150 BC. It’s also no mystery that the Freemasons were the first to organize in the modern era for the same reason.

Workers organize when they can – because they can. High skills invariably means unions.

Workers of the world Unite - it is one big economy, after all.

Workers of the world Unite – it is one big economy, after all.

Coming back to the US today, we have the strong anti-union position held not just by US companies, but also by many politicians and workers themselves. The 2014 rejection of the United Autoworkers at a VW plant in Chattanooga, TN was only the most bizarre instance of this. Despite Volkswagen’s best efforts to organize a “works council” around the union, the arrangement they had come to rely on, the good folks of Tennessee had a fit over the idea. Didn’t VW come to the volunteer state because it is non-union, er, “right to work”?

The short answer, if you’re a company looking for skilled labor, is no.

There is little doubt that US companies like the flexibility of our system. But the need to define jobs as simply as possible and keep out unions that stick their noses in the business puts this smack up against the need for a highly skilled workforce required more and more in the new economy. But it doesn’t have to.

We can, and almost certainly should, define a new relationship between workers and management in this new economy. It probably won’t be defined first by law but by the workers themselves in the next few years as the shortage of skilled workers starts to bite. The definition of “flexible” will start to include time to raise a family. Unions will probably trade higher wages for security, probably in the form of a union contract that can move workers between different company and still give them good supplemental pay inbetween gigs.

How exactly will this work? It’s not clear. What we can say is that it will be much more organized than it is today. Workers will be more skilled and more in demand. That means more unionized – it always has and it always will.

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12 thoughts on “Labor Unions are Inevitable

  1. As long as our governments don’t sell us out and bring in (TFWP) Temporary Foreign Workers to do these jobs requiring more skills, we will be okay.
    Leslie

    • This is a take-off from my previous predictions that:
      1) There will be a labor shortage in the near future, and
      2) Companies are going to keep demanding higher skill levels.

      We have already seen both trends forming around us. If they accelerate, as we can expect, we will be in a condition that has always created labor unions. Always. It simply seems inevitable.

  2. My Dad has been a union member his whole life and I couldn’t imagine a world without it. The politics is wild but they do protect workers in a way they can’t be protected on their own. He’s told me some stories of going to bat for workers who were injured on the job and were going to be fired but the pipefitters stood up for them. We need more of that in this country. Good blog for Labor Day!

  3. I used to consult for the Engineering Dept. of DuPont–very old-line corporation, very anti-union. A white collar union there–of engineers, say–would have been inconceivable. If a plant voted in a union they would look for excuses to close it. At it height–maybe 50s through 70s–even the janitors could aspire to a middleclass standard of living. Company had generous pension plan, matched retirement account contributions, didn’t usually fire people unless they stole or fucked up big time. And, first the janitors became low-paid contract people, then the people running the copy machines … eventually they came for the engineers and middle management. And now, DuPont is essentially gone–broken up and stripped of assets.

    Could this have played out differently? I dunno, but the German chemical companies have managed to thrive. I suspect their management–collectively–is smarter, and that would include worker contributions and participation.

    Question: If I’m a worker at, say Volksvagenverke, say a millwright or something like that, can I move to Daimler Benz or BMW?

    • I haven’t written about it in a long time, but yes – the main reason manufacturing jobs were so good is that they offered a lot of upward mobility. Looking back on it, however, I can’t see any reason why that was necessarily true – but it certainly was traditional. Loyalty used to be a big thing in every corporation, but it was especially true in manufacturing. I honestly don’t know why.
      duPont makes me angry. They are indeed dead. The European chemical companies are not doing all that well, either, but they aren’t dead. It’s something. The move to specialties as good profit centers has helped a lot.
      I don’t think workers move between companies because they would have to move to a new city to do so – and Germans don’t usually move. But I do think they could if there was an opening, yes. They have a system based partially on seniority but also based on qualifications for skill as set up by the unions. You achieve a rank based on what you know. Very German.

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