Unions Didn’t Cause Loss of Building Jobs

The relatively good wages and benefits won by union workers in the U.S. construction industry apparently are not the reason that their share of construction jobs has plummeted in recent years.

The theory that union workers have priced themselves out of the market has become a widely accepted explanation for the steady increase in non-union construction work. After all, the argument goes, it is natural for contractors to prefer non-union workers who make about half as much money as those in unions.

That’s the principal argument being used in Congress by the Chamber of Commerce and other conservative groups in their battle to prevent passage of a bill to outlaw “double-breasting”--the practice by unionized contractors of opening non-union subsidiaries to evade union contracts.

The steady increase in double-breasting is largely to blame for the drop in the share of construction work going to union workers. And there are other reasons, such as the well-financed campaigns by non-union contractors’ associations and by union-busting labor relations consultants to oust unions from some firms and keep them out of others.

But a study released last month by a national research group contradicts the contention that the high cost of union workers eliminates union jobs.

The study shows that the productivity of union workers in constructing retail stores and shopping centers is an astounding 51% greater than that of their non-union competitors. On commercial office building projects, the union workers’ productivity is at least 30% higher.

Even though the unionists’ wages and benefits are substantially higher than those of non-union workers, developers’ costs and contractors’ profits are about the same regardless of who does the job, according to the study.

In other words, the union workers’ higher productivity compensates for their higher wages and benefits.

The study was conducted by the National Bureau of Economic Research, based in Cambridge, Mass., and was financed by the U.S. Department of Labor, the National Science Foundation and North Carolina State University. The research was led by Steven G. Allen, a graduate of Harvard University and a professor of economics at North Carolina State University.

Allen’s study shows that larger projects (100,000 square feet or more) actually cost less when built with union workers. The same is true but less so with more simply designed projects under 32,000 square feet.

The Allen study shows that union workers are better trained than non-union workers. It also leads to at least one interesting conclusion: Contractors who fight so hard to operate with non-union workers are less motivated by the hope of meaningfully reducing labor costs than by a determination to retain authoritarian rule over employees. There is no doubt, however, that union jobs in construction have dwindled drastically.

There are no exact figures, but the Chamber estimates that 20 years ago unions represented more than 80% of workers in construction; today they represent fewer than 30%. Others estimate a smaller loss, but all agree it is substantial.

That gets us to the anti-double-breasting measure, which the House passed two weeks ago. Even if it becomes law, it will not stop the erosion of unions in the construction industry. But it will help.

The legislation would require that a company and all of its subsidiaries be treated as one employer under labor law. The National Labor Relations Board, controlled by appointees of President Ronald Reagan, has, in effect, approved the creation of non-union subsidiaries by unionized contractors. That is bound to encourage the continuation of the practice, unless it is stopped by the proposed law.

There is a fairly good chance that the House bill will pass the Senate despite a filibuster threat by Sen. Orrin G. Hatch (R-Utah) and Sen. Robert Dole (R-Kansas). It can pass if it is tightly attached to another measure the filibusters want the Senate to adopt.

Opponents of the bill concede that it could win a majority. But, they say, it will fall short, by about six votes, of the two-thirds majority needed to break a filibuster.

Even if a filibuster were broken, the bill’s prospects would be dim. The nation’s corporate executives always can depend on Reagan in any fight they have with unions, and he already has threatened to veto the measure.

Foes of the measure complain that without the ability to open non-union subsidiaries, they cannot compete with totally non-union firms. Obviously, this point is knocked down by the Allen study.

But even if the study overestimates the productivity of union workers, the anti-double-breasting bill is essential because employers should not have a legal gimmick to evade union contracts through creative corporate paper work.

Alternative to Strike

Like other unions, the Newspaper Guild is experimenting with alternatives to strikes as a way to pressure employers to sign what the Guild believes are fair contracts.

The tactics include, for instance, a “byline strike” by reporters and columnists at the Baltimore Sun newspapers.

Before there was an actual walkout by Guild members on June 10, writers had their names removed from their news stories. Those stories were published anyway, but the columns were eliminated until a strike settlement was reached June 16.

Some of the writers continued their unusual strike for a few days after the walkout ended June 16.

The byline strike tactic is designed primarily to irritate management, a relatively minor and not very common form of protest. Such strikes are intended, in part, to take away management’s ability to offer readers the attraction of popular writers.

In addition, they usually are used to publicize a particular management action, such as the threatened removal this month of an experienced Cleveland Plain Dealer reporter from a story about potential design flaws at a new nuclear energy plant. That strike was successful. The reporter kept his assignment.

The strike against the Sun newspapers--which were purchased in May, 1985, by Times Mirror, the media company that also owns the Los Angeles Times--ended when Guild members accepted a new contract. The contract terms were improved slightly from a pre-strike management offer.

The settlement was accelerated by rumors that management was preparing to hire strikebreakers, an increasingly frequent practice in many industries.

Tensions at the Sun had been high anyway. The company had hired security guards to watch the picket lines and videotape strikers who, the company said, may have engaged in vandalism.

In Sacramento and Fresno, the Bee newspapers, owned by the McClatchy Newspaper group, are the target of a subscription cancellation campaign waged by the Guild to protest management’s attempt to base salaries only on performance as evaluated by editors--not on other less subjective factors such as seniority.

The use of alternatives to strikes is increasing. Union leaders are wise to try to develop these sorts of alternatives so that they can avoid the complete loss of pay that results from walkouts.

Freshmen Seek Jobs

Necessity was probably the major force motivating college freshmen to seek and find jobs in what the U.S. Bureau of Labor Statistics said were record numbers last year.

Tuition costs have soared by more than 70% since 1980, a strong job-hunting incentive for youths who want a college education.

But the fact that a record 48% of all youths who entered college last year were in the work force also seems to weaken, if not destroy, the contention of some that this generation of college students doesn’t have the same strong work ethic that was said to be prevalent in the “good old days.”

The “work ethic” of Americans always has been more prevalent when their need is greatest. Children didn’t go down into coal mines in the early part of this century because of their own, or their parents,’ conviction that hard work is beneficial to the soul. They worked because if they didn’t, they and their families might not eat.

And as the purchasing power of the dollar goes down, more people need to work to help support their families and pay for education. So, with the real wages of non-supervisory workers down 5.75% since President Reagan took office in 1981, college freshmen had good reason to be in the work force in record numbers.

That’s sad. But the good news is that the work ethic, such as it was, has not diminished.