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EconomicPolicyInstitute March 25, 2009

EPI has long argued that restoring the right to form or join a union would go a long way toward returning balance to labor markets, where bargaining power has been heavily weighted toward employers in recent years. That imbalance has contributed greatly to recent historic increases in income and wealth disparities between the very rich and everyone else.

This month, legislation that would enhance workers’ organizing rights — known as the Employee Free Choice Act — was introduced in both houses of Congress. The law would impose real penalties on employers who harass or fire union sympathizers, or otherwise try to scare workers away from a union. If a majority of employees at a workplace sign cards favoring a union, the act would require an employer to recognize it, rather than undertaking a long, costly and destructive battle. The act also would bring in a third-party arbitrator to produce a fair contract if the two sides can’t agree on one within a year.

EPI prepared a question-and-answer document to explain the Employee Free Choice Act, and has been instrumental in making the economic argument in its favor. EPI President Lawrence Mishel, along with Richard Freeman of Harvard and Frank Levy of MIT, authored a statement signed by 40 prominent economists, including three Nobel Prize winners, who agreed that the reform would be an overall benefit to the economy, and would provide a boost to workers when they need it most. Now they are inviting other economists to add their voices by signing the same statement.

Over the years, EPI’s staff economists and associated scholars have conducted extensive research on unions and the economy. A partial list of significant studies and analysis follow:

State of Working America 2008/2009, excerpts from select chapters
This signature publication by EPI, which has documented the economic well-being of American workers since 1988, contains a wealth of information on union benefits for members and non-members, especially for African-Americans, Hispanics and Asians.

Still Open for Business: Unionization Has No Causal Effect on Firm Closures, by John DiNardo, 2009
DiNardo, a University of Michigan professor and research associate at the National Bureau of Economic Research, offers overwhelming evidence that unionization does not cause businesses to fail.

Squandering the Blue Collar Advantage, by Josh Bivens, 2009
Bivens shows why unions are not to blame for the loss of U.S. manufacturing jobs, and that in fact, the real culprits are manipulated currency rates that make U.S.-made goods overly expensive. A dysfunctional health care system that burdens responsible employers with outsized costs, and high executive and managerial salaries, also contribute to any lack of competitiveness.

Organizing Prosperity, by Matt Vidal with David Kusnet, 2009
Using twelve case studies from a variety of industries, including nursing, meatpacking and janitorial, the authors show how unions can benefit workers and communities while making companies more productive. They also illustrate the damage inflicted when union representation is removed.

Unions, the Economy, and Employee Free Choice, by Harley Shaiken, 2007.
Shaiken, a professor at UC Berkeley, found that “The yawning gap between the robust demand to join unions and the anemic membership numbers reflects the fact that, for many Americans, joining a union has become a risk rather than a right.”

Do Workers Still Want Unions? More Than Ever, by Richard Freeman, 2007.
In this paper, Freeman, a noted labor economist at Harvard University, writes that an overwhelming majority of workers say in surveys that that want a stronger collective voice on the job, and believe that the move would be good for their firm as well.

A New Social Contract: Restoring Dignity and Balance to the Workplace, by Thomas Kochan and Beth Shulman, 2007
The authors note that at a time of soaring productivity, workers were not sharing in the profits. “People are working harder and smarter, but they are not sharing in the gains from their efforts.”

We have recently gathered our resources on unions and the economy to one page, epi.org/laborpolicy, and will be adding new research and analysis through the coming weeks and months. Please check back often.

From the EPI Blog
Lawrence Mishel and Will Kimball
The Top 1 Percent of Wage Earners Falters in 2013—Was it a Temporary Event?
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Myths and Facts About Corporate Taxes, Part 2: Will Congress’s Idea of “Base-Broadening, Rate-Lowering Tax Reform” Fix What’s Wrong With Our Corporate Tax Code?
Ross Eisenbrey
Corporations Are Stealing Your Constitutional Rights: Forced Arbitration Clauses
Lawrence Mishel
Chair Yellen Is Right: Income and Wealth Inequality Hurts Economic Mobility
Ross Eisenbrey
Businesses Agree—It’s Time To Raise the Minimum Wage
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