Right to Work. It's All About Freedom
13 of 17 Southern States Have Now Enacted Right to Work Laws
by Lee Burlett
Oklahoma has joined a dozen other Southern states that have passed Right to Work legislation. Oklahoma is the first state in 15 years to pass a right-to-work law. The results of the September 25th election on the right-to-work legislation showed that 54 percent of voters supported the measure. The new amendment means that mandatory union dues are now prohibited in the state. The outcome was a victory for business interests in Oklahoma. The decision makes Oklahoma the 22nd state to enact right-to-work legislation. Thirteen of those states are located in the American South.
Oklahoma has joined Alabama, Arkansas, Florida, Georgia, Kansas, Louisiana, Mississippi, North Carolina, South Carolina, Tennessee, Texas and Virginia as states in the American South that currently have Right to Work laws on the books. Only Kentucky, Maryland, Missouri and West Virginia are non-Right to Work states in the South. The geography of the South's non-Right to Work states is interesting. Note that each is a Southern "border" states.
Right to Work legislation basically means that no person can be denied the right to work because of membership or non-membership in a labor union. It also means that workers cannot be forced to pay union dues, collective bargaining fees or any other "in lieu" fees in order to keep their jobs. In Right to Work states, union membership cannot be a condition of obtaining or continuing employment. Union membership is not prohibited in Right to Work states. It simply means that workers can choose whether they want to join a union or not.
The fact that workers have the freedom of choice in whether or not to join a union that is organized at their place of work may be the most important facet of Right to Work legislation. Freedom of choice is what this country is all about. And after the events of 9/11/01, freedom in general has become a supremely important fact of American life.
This article is not one that will argue the positives or negatives of Right to Work. We'll leave those arguments to large union organizations such as the UAW and AFL-CIO and their combative opponents, primarily the National Right to Work Committee. But there's one thing for certain: Right to Work states are dominating non-Right to Work states economically.
While there are many more important factors that you will take into account during a site search, some will argue that there isn't a single one more important than the inclusion of Right to Work legislation prior to the start of that search . "Having Right to Work laws in place is not the No. 1 factor in a deal. It's not even No. 2," said Charles Kimbrough, a recruiter for the Office of Business Location, a department within the Oklahoma Department of Commerce. "But it could be the No. 1 thing that gets you kicked off the list from the beginning. I've found that many companies that are looking to expand or relocate, give direct orders to their site consultants not to include states that don't have Right to Work laws," Kimbrough said.
Bob Goforth, a well known national site consultant, agrees. "When a company begins a search, their search criteria checklist usually has two columns: needs and wants," Goforth said. "The needs would basically be the absolutes of a particular location and the wants would be things that would be nice to have if they can get them. More often than not, Right to Work will be found on the needs column. In other words, for many companies, if you're not a Right to Work state, you don't play in the game."
If, according to Goforth and Kimbrough, hundreds of site searching companies and their consultants eliminate non-Right to Work states from the beginning , then that would naturally mean more jobs are being created in Right to Work states. The statistics back that up. According to a press release from the Oklahoma Department of Commerce, between 1977 and 2000, Right to Work states gained more than 800,000 manufacturing jobs, while compulsory unionism states lost almost 2 million manufacturing jobs. The National Right to Work Committee claims that since 1960, Right to Work states have created nearly 3 million high-paying manufacturing jobs, while states without RTW laws suffered a loss of more than one million manufacturing jobs. In both cases, the sources did not indicate whether those figures were gross or net. The AFL-CIO disputes the claims.
However, the AFL-CIO cannot dispute these claims. According to U.S. Census Bureau statistics, non-Right to Work states have an average population growth of 10.61 percent since 1990. On the other hand, Right to Work states have experienced an average population growth of 18.43 percent since 1990. That growth is much greater since 1980. Furthermore, the four non-Right to Work states in the South have grown an average of just 7.65 percent since 1990. In contrast, Southern Right to Work states grew their populations by 15.28 percent since 1990, doubling the population growth of their non-RTW Southern bretheren.
If the theory that people follow the jobs is true, then there's no question that more jobs are being created in Right to Work states than in non-RTW states. In fact, our figures show that since 1985, nearly as many jobs have been created in the 13 Southern Right to Work states than were created in the other 37 states combined. Even more, our figures indicate that since 1990, more jobs were created in Texas, Georgia, Virginia, Tennessee and Florida than were created in the 28 non-Right to Work states combined.
And there's more. Dr. James Bennett of the Nobel Prize-winning economics department at George Mason University has studied cost-of-living adjusted household incomes for metropolitan areas in Right to Work and non-Right to Work states. According to his just-published study, median spendable household income for metro areas in Right to Work states is $2,333 higher than in median income in non-Right to Work states.
Here are some other numbers to consider:
- Since March of 1991, Right to Work states, which account for just 35 percent of the nation's population, have created more than 50 percent of all non-farm jobs.
- Since 1977, personal income in Right to Work states has grown almost 25 percent faster compared to non-Right to Work states.
- Nine of the top 10 states showing the largest growth in manufacturing employment from 1993-2000 were Right to Work states.
- The 22 Right to Work states have had lower unemployment rates than non-Right to Work states in every year but four since 1978.
- Gross State Product in Right to Work states grew by 38 percent from 1992-2001, while GSP grew by 27 percent in the same period in non-RTW states.
James R. Wilbanks, Ph.D., Senior Economist for the Oklahoma Office of State Finance, and a supporter of RTW during that state's recently ended campaign, completed a study recently that looked at Idaho, the last state prior to Oklahoma to enact a Right to Work law. Idaho passed RTW in 1986. Wilbanks' study found that Idaho experienced an increase in manufacturing employment growth 10 years after RTW was passed in that state. In addition, rural counties in Idaho also saw more manufacturing employment as a result of the enactment of Right to Work.
"You cannot discount the benefits of Right to Work laws," Wilbanks said. "The study clearly indicates that enacting Right to Work improved the economic situation of Idaho. By passing Right to Work in Oklahoma, we have removed one potential impediment to business growth in our state."
OK, so its good for a state's economy if it has Right to Work laws in place. It's also good for employees who work in Right to Work states, if the freedom of choice in whether to join a union or not is of importance to that employeee. But how is it good for your next automotive-related expansion project? Many of you already know that answer, but let's review it for those who don't.
In Right to Work states, your management team has more freedom away from sometimes endless negotiations with labor. That means your management team can concentrate on managing the company, not managing the company and dealing with its labor union. Greviences, in the formal way they are presented to management by a union, costs money, time and slowly split apart a positive relationship built by labor and management.
Yet, possibly the most damaging aspect of unionism is a strike. The second most damaging for your operation is the fear of a strike. Do you remember strikes by labor of Caterpillar and International Harvester? They were devasting for those companies. Not only did those giant manufacturers lose business, they lost long time customers.
U.S automakers have also felt the wrath of the labor stoppage over the years. Maybe that's why every foreign automaker that has built a major auto or truck plant in this country in the last 10 years has chosen a Right to Work state. Mercedes (Ala.), Nissan (Tenn. and Miss.), BMW (S.C.), Honda (Ala.) and Hyundai (Ala.) are those companies and plant sites.
Regardless of Right to Work's effect on a state's economy, this article is titled, "It's All About Freedom." More specifically, the freedom to choose to agree with a union's stance or not. That freedom, according to an unnamed site consultant (he did not want his named used simply because Right to Work is "a sensitive issue" and he has assisted unionized companies and continues to do so), makes for a "much happier worker. An unhappy worker is not a productive worker. If an employee disagrees with what the union is doing, yet is forced to be a part of that union, how is he going to feel? He or she is paying dues to an organization that he or she doesn't agree with its policies," the unnamed consultant said. "Would that same employee prefer to have management meet him personally in a conference room if he has a complaint, or even at his post on the line? Or would he want a formal grevience -- his grevience -- presented by the union? I've found employees prefer to work things out with management themselves."
That certainly seemed to be the case with one of the largest manufacturing plants in the South recently. Workers at Nissan's automotive plant in Smyrna, Tenn., voted 3,103 to 1,486 against organizing under the United Auto Workers. The 2 to 1 margin was roughly the same as the failed unionization vote at the plant in 1989. Nissan produces five different models at the 6 million-square-foot facility. The UAW has repeatedly attempted to gain a foothold in Smyrna. Since the failed 1989 vote, organizers have unsuccessfully tried to place a unionization vote before workers on two occasions, but had been unable to garner enough signatures to prompt a vote. If the UAW vote had been successful, the Smyrna plant would have become the first foreign-owned automaker with UAW representation.
Another sign that Right to Work is all about freedom centers around the fact that Oklahoma is the first state in 15 years to adopt it. Surely, there are states out there that want the same Right to Work result the state of Oklahoma fought so hard for. Oklahoma has shown the nation non-RTW states indeed have the freedom to change their current obligatory unionism laws. "We had a lot of third-party endorsements and help in general from those sources," said Oklahoma's Charles Kimbrough. We asked Kimbrough what kind of third-party help he was talking about. "Other states, who are non-Right to Work states, contributed financially to our campaign." What states, we asked? "Can't say." Why would they help, we asked? "They helped us pass the legislation, so if they ever put Right to Work to a vote, they might get help from us. I'd expect, after passing Right to Work in Oklahoma, that we would help them," Kimbrough said. Now that's freedom of negotiation!