‘Right to Work’ Laws Increase Poverty, Decrease Productivity

On February 1, 2012, Indiana governor Mitch Daniels signed a “right-to-work” (RTW) provision in the state’s labor laws, making Indiana the twenty-third RTW state in the nation and the first in more than a decade to pass a law undermining the ability of unions to organize and represent their members. As I write this, efforts are under way in at least a half-dozen other states, including Ohio, Maine, Michigan, Minnesota, and Oregon, to follow the Indiana example and further limit the rights of unions nationwide.

In RTW states, unions are prohibited from including in their contracts “union security clauses,” which require all employees in the bargaining unit either to join the union or pay a portion of its dues. Worker-friendly states, on the other hand, allow provisions for the union to be the exclusive bargaining agent for those workers who are eligible for membership, and also require all eligible employees to pay at least a portion of the union dues.

Despite the eagerness to adopt these laws, the question of whether RTW laws actually benefit a state economically has remained largely unanswered. In this paper, using the most recent data available from public sources, I have analyzed a spectrum of seven measures for standard of living, including Gross Domestic Product GDP), poverty rates, life expectancy rates, and “income gap,” and determined whether there are differences in these measures between the 22 RTW states (not including Indiana, which joined them after this data was collected) and the 28 worker-friendly states.

The results clearly show the adverse consequences of RTW laws on people living in those states, and should inform the good efforts of union members and allies to quell the ongoing efforts to spread these laws nationally. Dr. Martin Luther King, Jr. once said, “In our glorious fight for civil rights, we must guard against being fooled by false slogans as ‘right to work.’ It provides no ‘rights’ and no ‘works.’ Its purpose is to destroy labor unions and the freedom of collective bargaining.” The evidence presented here shows that Dr. King was absolutely right.

An Analysis of the Data

The GDP, or the total amount of goods and services produced in a year, is probably the most accessible single measure of standard of living. A high GDP positively correlates with a high standard of living, and changes in living standards can be swiftly observed in corresponding changes in the GDP.

According to 2009 data, the GDP per capita for worker-friendly states collectively was $43,899, while the GDP per capita for the RTW states was $38,755 or 13.3 percent lower. It is worth emphasizing that GDP represents goods and services produced, and is not the same as per capita income. Thus, the initial analysis of this measure indicates that the worker-friendly states appear to be significantly “more productive” than the RTW states.

Poverty rates: Obviously a state with a high standard of living would be expected to have fewer residents living in poverty. Using U.S. Census income data, and applying it to the two groups of states, we find again that RTW states have a lower standard of living. Eleven of the 15 states with the highest poverty rates are RTW states, while nine of the 11 states with the lowest are worker-friendly. Furthermore, the percentage of the 2008 population living in poverty in RTW states was 14.4 percent, while the percentage in worker-friendly states was 12.4 percent. To put this difference in perspective, if the rate of poverty in RTW states was extended across the nation, an additional 3,670,000 American men, women, and children would be living in poverty today.

Health insurance: One would expect that a state with a high standard of living would have more of its citizens covered by basic health insurance, giving them access to preventive care and swift medical treatment. And, once again, the Census data show that the worker-friendly states have a higher standard of living. Fully 11 of the 13 states with the lowest uninsured rates are worker-friendly states, while 11 of the 15 states with the highest uninsured rates are RTW states. The median uninsured rate for worker-friendly states is 12.6 percent, while for RTW it is 15.7 percent. Again, to put this in perspective, if the rates of non-insured citizens in RTW states were spread across the country, then an additional 8,640,480 Americans would be uninsured and suffer a lack of access to affordable health care.

Life expectancy: While there may seem to be little reason for a correlation to exist between RTW laws and the life expectancy of citizens in those states, life expectancy data from the Harvard School of Public Health was included here because it is a very common measure of standard of living. And, as it turns out, the data reveal a surprising trend. Of the 13 states with the highest life expectancy rates, 10 are worker-friendly states. Conversely, of the 12 states with the lowest life-expectancy rates, only two are worker-friendly states. In worker-friendly states, citizens can expect to live 77.6 years (the median), while citizens in RTW states can expect to die at 76.7.

To read on (and to see the author’s state-by-state tables for each standard of living), visit www.nea.org/thoughtandaction.

  • Ej Spence

    These are just correlations, not necessarily cause and effect. I personally like RTW. If a union has a good reputation for serving its members employees would want to join. How does forcing people to join an organziation that they do not want to help workers or any of the statistics you mentioned? I see how it helps unions and, well, I AM on a Union’s page ….

  • tmccormick

    Simply being “on” a union’s page means nothing if you’re a purveyor of the internet – trolls are prolific.
    That said, your argument is incomplete at best. Allowing unions is not “forcing” people to join, but keeping that door open as an option. Conversely, RTW prohibits people from joining together to simplify the process of negotiations. As a teacher, I don’t want my time consumed with worrying about my living wage. With collective bargaining, I have a vote and a say, and can get on with what is most pressing to me: my work with my students. If my state goes RTW, I will be more consumed with worries about income and competitiveness with my colleagues (which in spite of what you hear reformers say is not good for kids!), instead of working as a team for the greatest benefit of the next generation. No contest, dude!

  • btruax

    It has been my experience that RTW breeds apathy, and apathy is the soil in which trees that bear little fruit are grown. Employees in worker-friendly states have a greater stake in working together to assure a plentiful harvest.

  • Michael

    Libertarians would seem to always prefer “right to…” anything at all. I am puzzled by the very selective choices of the left when it comes to rights.

    Contrary to tmccormicks’ assertion, right-to-work states do not prohibit unions. You are free, personally, to join or not. The exception is that you cannot be forced to PAY the union EVEN WHEN YOU ARE NOT A MEMBER.

    Read this part carefully from the article: “In RTW states, unions are prohibited from including in their contracts ‘union security clauses,’ which require all employees in the bargaining unit either to join the union or pay a portion of its dues.”

    It means that you, the employee, can be required to pay a “portion of its dues” even when you are not a member of the union. While I can sort of see some sense in it if you are benefiting from union collective bargaining, the answer is two-tiered hiring. Union members bargain for their wages; everyone else negotiates one-on-one; might get more, might get less — rather often less, the NEA is right about that! Union members that still have jobs generally DO have higher incomes; but beware “still have jobs”.

  • Pingback: Teacher Union Czars’ Anti-Right to Work Crusade Hurts Teachers()

  • Pingback: Teacher Unions Anti Right to Work Crusade Hurts Teachers()

  • yoniphile

    Even FDR said government unions should not exist. There is a nefarious collusion between government (namely the Democratic party) and government unions. RTW is necessary and should be in every state.

  • Rusty

    Yoniphile….FDR was not against public unions, in fact he said it made sense public workers would come together for fair pay, benefits, and such was “natural and logical.” What he was against was public unions using strikes as a tool for collective bargaining.

  • Pingback: UNITED STEELWORKERS LU 5890 » Blog Archive » The ‘new’ Saskatchewan: Oklahoma North?()

  • “Worker-friendly” states are those which tell workers that if they do not join a union they are fired? Those are “union-friendly” states!

    Anyone who is a friend of a worker allows that person the freedom to choose whether they will join or financially support a labor union. Just like anyone who is a friend gives you the freedom to choose whether you will join or financially support a church or any other organization.

    Your enemy is the one who takes your freedom of choice away from you and gives it to the employer and union. In Right to Work states employees are free to join unions, just like in every other state. If union density is low in Right to Work states, it shows that unions need to use coercion to force employees to support them.

    Many of the statistics cited in the article have to do with the cost of living. Compulsory unionism is more prevelant in high cost of living states. Are you really earning more if it costs you more to live? Of course, not.

    Finally, when was the last time a state went from Right to Work to non-Right to Work? Citizens can vote to change the Right to Work law. I’ll bet no one reading this can remember such a thing. Why? Because employees love freedom and they are throwing off the shackles of coercion when it comes to labor unions.

  • donewithblindpoliticalfollowers

    From my experience, working in a union-friendly state does NOT mean that they are worker friendly. When I got hired by a particular school system, I was told that they were the representatives for all the teachers in that county and that I did not have to join, but that I would still pay $500 out of the 536 in dues at the time. And you would not be covered for liability or other issues in case it arises. You would basically be paying them to represent you. So, from a logical standpoint of a new professional, it is forcing someone to join. I’m not going to pay hundreds of dollars to an organization whose political affiliations support causes that are against my beliefs. It would also be idiotic to almost pay the fees for joining an organization and then have to go outside to get liability coverage. This is where the unions benefit. If they were so great, they wouldn’t have to have such laws in place. RTW states (like where I grew up) give teachers the flexibility to either join a union or find other means to protect themselves and gain professional development. What I am not saying is that unions shouldn’t exist; for those that desire them, that should be their option. However, for those that don’t, do not infringe upon their rights by essentially forcing them to be members or find employment elsewhere.

  • Pingback: How ‘right-to-work’ laws would reshape Michigan’s economy()

  • Pingback: Michigan to become right-to-work state - Democrats, Republicans, Libertarians, Conservatives, Liberals, Third Parties, Left-Wing, Right-Wing, Congress, President - Page 30 - City-Data Forum()

  • Pingback: America: Who loves workers? It’s not the GOP! | Living Democracy()

  • Hello! This is my first visit to your blog! We are a collection of
    volunteers and starting a new initiative in a community in the same
    niche. Your blog provided us valuable information to work on. You have done a wonderful