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Is Labor Losing Its Voice?

Once a major force in the nation's economy and politics, unions have fallen on hard times. Can they convince a new generation of workers that they're still relevant?

By Steven Greenhouse

When he was a high school senior a few years ago, Josh Noble took a part-time job changing tires and installing batteries at a Wal-Mart tire-and-lube garage in his hometown of Loveland, Colo., north of Denver.

Noble liked working on cars, but after two years at Wal-Mart, several things bothered him: The company paid him less than local supermarkets would have, its health plan was expensive, and the garage paid some new workers more than it paid him.

"I was fed up," Noble says, complaining that he earned so little that he had to give up his apartment and move back in with his parents.

So Noble did what dissatisfied workers have done for decades to try to improve their wages and working conditions: He attempted to form a labor union. In seeking to unionize the garage's 18 workers, Noble created a huge fuss. Here was a snowboard-loving, earring-wearing 21-year-old taking on Wal-Mart, the world's largest corporation, with 1.7 million workers worldwide. If Noble prevailed, he would create the first successful union at any of the nation's 3,650 Wal-Mart stores.

Powerhouse Past

Many union leaders embraced Noble's cause, seeing young people like him as the best hope for America's problem-plagued labor movement. Fifty years ago, organized labor was a powerhouse, representing about 35 percent of the U.S. workforce, able to pressure even the largest corporations to grant generous contracts that helped America build the world's biggest middle class.

After becoming a political force in the 1930s, unions successfully pushed Congress to enact the minimum wage and the 40-hour workweek. During World War II and in the decade after, they played a pivotal role in securing medical coverage and pensions for millions of union and nonunion workers alike. And in the 1970s, they helped win passage of the Occupational Safety and Health Act (OSHA), which sets safety standards for the nation's workplaces.

Just how influential were America's unions? In 1961, the hatters union, alarmed that fewer men were wearing hats, persuaded John F. Kennedy to wear a top hat at his presidential inauguration.

Today, however, labor unions are struggling and now represent just 12.5 percent of the nation's workers. As manufacturing, labor's longtime stronghold, continues to shrink in the U.S., unions are groping for ways to reverse their decline. Their strategies include trying to attract more young workers, immigrants, and low-wage workers, many in service industries.

"Unions can still do an awful lot for workers," says Richard Hurd, a labor-relations professor at Cornell University. "When people form unions, their pay goes up, their benefits improve, and they start to have a real voice on the job."

But many corporate leaders argue that unions are just not as necessary now as they were in the early decades of the Industrial Revolution when companies could, and often did, mistreat their workers with impunity. "Most employers don't fit that category any longer," says Randel Johnson, vice president for labor policy at the United States Chamber of Commerce. "Employers generally treat their workers much better, and that's why the need for unions has diminished."

The labor movement first gained steam in the 1880s, when workers felt that industrialists often paid them too little to live on, worked them too hard, and subjected them to unsafe conditions. It was an age when workers often toiled 12 hours a day, six days a week. Many workers realized that they had little leverage dealing with their employers individually. But if they banded together and threatened to strike, they could often pressure employers to improve wages and working conditions.

Squaring Off

The rise of unions created huge tensions. Many companies saw unions as the enemy because they threatened to push up wages and cut profits. At times, the confrontations turned violent, like the Homestead Steel Strike in Homestead, Pa., in 1892, in which seven workers were killed.

Union membership multiplied during the Great Depression of the 1930s, when a quarter of the workforce was unemployed and many workers threw their support behind unions. In 1935, President Franklin D. Roosevelt signed the National Labor Relations Act, which created a federal right to form unions. The law meant that companies had to bargain with a union when employees voted to unionize.

As industries like steel and automobiles grew rapidly, union membership soared. Unions reached their peak of political influence during the Roosevelt administration, when labor leaders were some of the president's closest advisers, and in the postwar years, as the nation's economy boomed.

In the 1950s, however, organized labor's reputation suffered as federal investigators asserted that several unions, including the Teamsters (which had originally represented horse-team drivers but came to represent truck drivers), were under the influence of organized crime. Officials from some large unions were convicted of stealing money from pension funds and taking bribes to ignore workplace violations.

You're Fired

The 1980s were hard times for unions as a deep recession and greater competition from foreign companies put millions of union members out of work and pressured unions to grant wage concessions to help keep their companies from going under. President Ronald Reagan further weakened unions by firing 11,500 air traffic controllers in 1981 after they went on strike in violation of federal law. The President's strong response emboldened companies to take a tougher stance toward unions.

In the last two decades, globalization—and in particular the outsourcing of jobs to other countries—has continued to weaken unions in their traditional strongholds. But even as manufacturing unions have declined, there has been strong growth in unions representing government employees, including teachers, and service-sector workers like janitors and hospital aides. Today, the nation's largest union is the National Education Association, representing more than 2 million teachers.

In recent years, organizers have focused on unionizing immigrant and low-wage service workers. But they have also targeted some surprising groups, including university graduate teaching assistants, psychologists, and even doctors. One of the strongest arguments unions make is based on statistics: Unionized workers earn considerably more each week on average than nonunion workers—$781 versus $612. In addition, union members are more likely to have health insurance㭒 percent, versus 56 percent for nonunion workers. (Some economists say the reason for the gap is that unions tend to be in higher-paying industries.)

Unions say that globalization has made them more crucial than ever. But critics argue that unions raise the cost of doing business in the U.S. and prevent American companies from competing against more-efficient foreign competitors. It's no coincidence, they say, that the auto and airline industries, with their large unionized workforces, have suffered huge losses and even bankruptcies in recent years. (In October, the United Auto Workers union reached a tentative agreement with a struggling General Motors for a $1 billion annual reduction in health benefits for GM retirees and workers.)

As unions seek to reverse their slide, they have made Wal-Mart a primary target. They contend that Wal-Mart's wages—averaging less than $19,000 a year—pull down wages for workers across America. That helps explain why unions embraced Josh Noble's efforts. They thought that if he could unionize his automotive department it would set the stage for unionizing—and raising wages—at other Wal-Marts.

Strong Counteroffensive

Last November, Noble got more than half of the garage's workers to petition the National Labor Relations Board to conduct an election to determine whether a majority of the garage's workers wanted a union. Wal-Mart officials mounted a vigorous counteroffensive, arguing that the garage paid competitive wages and did not need a union. Wal-Mart flew in two officials from its Arkansas headquarters who spent several months working in the garage, seeking to persuade employees to vote against a union.

In February, Noble was stunned when the tire-and-lube workers voted 17 to 1 against unionizing. Several feared that Wal-Mart would close the garage and that they would lose their jobs if the union was voted in. "We thought the only way they'd listen to us is to have a union," Noble said after the vote. "It wasn't a fair fight."

Most of his co-workers were unswayed. "My grandfather said that during World War II, unions were helpful," says Dan Wright, a technician in the garage who voted against the union. "But I don't feel I need one. This company treats me well. It's fair to people."