America’s Private Sector Labor Unions Have Always Been in Decline

Looks like it’s time for another round of Internet Thumbsuckers About Labor Unions. Specifically, Daron Acemoglu and James Robinson think economists should pay more attention to the political economy impacts of labor unions and not just to their localized impact on wages and growth. Kevin Drum agrees citing his past Mother Jones article offering a somewhat rosy gloss on the political economy of U.S. unions (here’s a less rosy gloss from Mother Jones on prison guard unions).

I think this chart Doug Henwood posted in January tells you what you really need to know about this, namely that private sector labor unions have been in decline in the United States pretty consistently since World War II. There was a little uptick associated with the Great Depression, but really mass private sector labor unionism in the United States was an element of wartime economic planning. Then, in the immediate postwar years, we were at something of a political economy tipping point. We could have become a country where the overwhelming majority of large private sector firms were unionized, but instead congress passed the Taft-Hartley Act. It’s been a long steady decline since then, partially masked by the unionization of a large swathe of public sector workers in the 1960s.

And there’s obviously not going to be a major legislative turnaround now. In part that’s because the 60-vote hurdle in the Senate is inherently hard to clear, but in part it’s because those political economy considerations cut both ways. Hedge fund managers don’t particularly need to fear their own workforce becoming unionized in a way that hurts the bottom line narrowly, but they do need to fear a tipping of the overall political landscape in a way that’s unfavorable to them. On the face of things, groups dedicated to making abortion illegal should have no beef with the AFL-CIO but in practice AFL-CIO political activity is overwhelmingly favorable to politicians who want to keep it legal.

But back to the chart. The important point it makes, I think, is that it’s essentially always been like this. There’s been no sustained period of time when the political or economic landscape was favorable to a growing union share in the workforce. There was a large, one-off increase in union membership associated with the coincidence of a major gloabl war and a Democratic Party administration. My understanding is that there was a similar unionization surge during World War I. So anyone looking for a peacetime surge in union membership (I don’t see anyone advocating a giant war) to transform the political dynamic is hoping for something essentially unprecedented. Just because it’s unprecedented doesn’t mean it might not happen, of course. But by the same token if “something unprecedented” happens why expect that unprecedented thing to involve NLRB-recognized collective bargaining units as opposed to some other form of membership organization?