By Alejandro Queral
Recent actions such as these offer hope for our nation. For as history and data make clear, the fortunes of organized labor go hand-in-hand with those of the middle class. Today, with economic inequality having returned to levels not seen in more than eight decades, a revival of union power is essential.
Historically, the fruits of organized labor have spread widely. Unions have led the effort to create an economy that works for all Americans, resulting in worker protections such as child labor laws, safer working conditions, overtime compensation, and the 40-hour work week. Following World War II, a vibrant labor movement nurtured a broad middle class by setting standards for wages and benefits. And while the beginnings of the labor movement were fraught with racism and discrimination, African-Americans and later workers of color came to make up a significant portion of union membership.
By the late 1970s, union membership began to decline nationally and in Oregon, especially among private sector workers. The offshoring of manufacturing jobs, more aggressive efforts from corporate leadership to deter unionization, and a federal government more willing to look the other way are among the many and complex factors leading to the decline. In 1977, unions represented 34 percent of the Oregon workforce. By 2018, that share had dropped to 15 percent.
As unionization waned, economic inequality began to rise. In 1980, the richest one-tenth of 1 percent in the state — the richest 1 out of every 1,000 Oregonians — made 26 times the income of the Oregonian in the middle. By 2016, that factor had jumped to 127 times.
This is no accident. In direct and indirect ways, unions buffer against economic inequality and help ensure shared prosperity.
The most direct way by which unions reduce inequality is by collectively bargaining for higher wages. For example, Oregon’s lowest paid workers represented by a union enjoy wages that are 21 percent higher that non-union workers, while unionized middle-wage workers earn 17 percent more than their non-union counterparts.
Yet, the benefits are not restricted to union members only. In industries where unions are prevalent, even nonunionized workers receive higher wages than similar workers in less unionized industries. This is because the presence of unions in an industry can persuade nonunion employers to raise wages and benefits to forestall unionizing campaigns and compete for workers. Likewise, unions can set standards for safety and benefits for all workers in an industry.
Beyond gains in the workplace, unions also play a key role in setting the rules that govern the economy — rules that either promote broadly shared prosperity or prosperity for the few. Here in Oregon, unions were instrumental in realizing a big increase to the minimum wage a couple of years ago. This year, unions led in achieving the biggest increase in education funding in the history of the state.
This Labor Day, let’s honor the struggles of organized labor that built this nation’s middle class — and which will rebuild it in the years to come.
Alejandro Queral is Executive Director of the Oregon Center for Public Policy. The Center uses research and analysis to advance policies and practices that improve the economic and social opportunities of all Oregonians.