CHAPTER TWENTY-ONE

The Decline in Unionization

IN 1945 ALMOST 40 PERCENT of the American labor force was unionized. By 1977 the percentage had fallen to 26 percent. (1981 note: And in 1981 it was down to 20 percent or less.)

In 1945 practically the entire union membership was in the private sector, in which unionization approached 50 percent. Since then, the great growth of union membership has been in public-service employment—in government, in hospitals, in schools, and so on.

In the private sector, therefore, at most one of every six employees is a union member and membership is heavily concentrated in mature if not declining industries. (1981 note: In the private sector, union membership is now back to where it was before the tremendous unionization wave of the 1930s.)

Union membership in the public sector is still growing. But it is clearly running into increasing resistance from taxpayers and from public service employers. It is doubtful whether the public service unions can hold on to recent gains, especially with respect to job security and retirement pay, considering the severe financial crisis of local governments.

At the same time, membership in traditional private sector unions is changing fast. For instance, the new manual workers are less well educated, as a rule, than the rest of the population and no better educated than the men and women whom they replace—a startling reversal of a long-term American trend.

Young people with schooling go on to college or to a community college, and as a rule are not available for the traditional blue-collar jobs. The ones who are feel themselves to be “losers” before they start and are correspondingly militant. They also have far less allegiance than older members to the union as a “cause.”

Union leadership is about to be replaced. Even the “young” men among the traditional leaders are in their sixties. And with the steady decline in relative union strength, together with the steady erosion of leadership, has come a decline in political power (consider labor’s startling impotence with the Carter Congress and the Carter Administration, both of whom owed their election to organized labor) and in public esteem (every opinion poll shows the public has less trust in labor than in any other institution).

Given this mistrust, frustration, and labor’s sense almost of despair, we can expect very rough times ahead in labor-management relations.

But at the same time the issues are changing. Labor will continue to push for “more,” but it will push for “different” as well.

Employment security is clearly an emerging central issue. The steelworkers, in the 1975 round of contract negotiations, made significant advances toward lifetime employment for members. That goal will increasingly become part of the labor movement, in private and public sector employment.

With lifetime employment or some variant thereof, it will be management’s responsibility to find new jobs for workers whose existing jobs are being altered or abolished through changes in technology. This will require a kind of manpower planning which, so far, is virtually unknown in American industry (but which has long been commonplace in Japan and in Sweden).

Then there is the issue of union security. Union leaders do not just fight for the jobs of members, they also fight for their own jobs and for the survival of their own organizations.

The new jobs in American industry are not where the traditional unions are. They are not in the mass-production industries. They are not in craftwork, such as the building trades. Therefore, traditional unions see themselves as being elbowed aside and threatened with extinction. This will undoubtedly lead to jurisdictional strife between unions vying with each other for a larger piece of an ever-smaller pie. But it will also lead increasingly to union demands to freeze employment, to freeze technologies, and to freeze jurisdictions.

Perhaps the most difficult and yet the most important issue related to employment security is that caused by the population dynamics of the American labor force. It cannot be said too often that the great majority of people now reaching retirement age are blue-collar workers or low-grade clerks with limited education. A majority of young people entering the labor force have advanced schooling and are therefore not readily available for the traditional jobs on the assembly line, in the cab of a truck, or behind a sales counter.

Add to this the fact that the number of people entering the labor force (other than young blacks) will drop by 30 percent in the early eighties (as a result of the “baby bust” that started in the early 1960s) and we face a severe shortage of replacements for retiring blue-collar and clerical workers.

At the same time, the developing countries now need to find manufacturing jobs and jobs in export industries for the tremendous number of their young people who reach maturity as a result of the population explosion that started in the late 1950s.

So the situation is this: No matter what wage we pay, we will not be able to find enough people to do traditional work and we will have to subcontract labor-intensive work to developing countries. Increasingly, we will have to move toward an international exchange of work by stages of production. But this, of course, threatens the remaining workers in industries at home.

The best example of this is the 50,000 or so shoe workers, mostly elderly and mostly concentrated in a small area, whose jobs are being threatened by imports. Yet we could not possibly find enough labor in this country to produce the shoes we need.

The same is largely true with respect to steel, where labor-intensive American industry has been outflanked by a highly mechanized steel industry in Japan and by cheap labor in new automated steel industries of the developing world, e.g., Korea.

How is this to be handled if we accept—as we are about to do—the principle of lifetime employment? Protectionism is the obvious answer, but it is clearly the wrong solution. It will not help workers or employers except for a very short time. For protectionism helps only if an industry is growing. Otherwise, it harms the industry and the economy within a fairly short period.

At the same time, public policy will clearly not remain indifferent to genuine hardship. By and large, the workers who are threatened by “production sharing” in the international economy are older men and women not easily retrained or placed in other jobs. Should this be considered a national obligation (the approach taken in the Nixon Administration) or an industry problem (which is how steelworkers and automobile workers see it)? At any rate, it is clearly going to be a major labor-management problem.

Then there are the problems created by the rapid growth of work groups that do not fit any traditional molds: the older worker who has reached what is usually considered retirement age but who continues working now that fixed-age retirement is rapidly disappearing. Or the older married women who are joining the labor force in growing numbers and who increasingly need part-time rather than full-time employment. The question of the rights, benefits, and obligations of these groups has not been tackled yet. For example, what about their seniority and promotions?

These are all issues that will certainly come up eventually, but for which neither management nor labor is yet prepared. And there are other issues. Among them: indexing of compensation to offset the higher tax bracket into which inflation automatically pushes the employee, substantially reducing his disposable income. And settling the question of union representation on boards of directors and on the governing boards of employee pension funds.

The question is not whether these issues will arrive; they have already. The question is whether management will leave the initiative entirely to labor, as it has done for decades. The answer to that will go a long way toward determining the outcome of tomorrow’s labor relations and labor policies.

(1977)