The Anti-Union Governor
Scott Walker may be the nation’s leading union killer. What’s the impact on Wisconsin?
For more than a half-century, Wisconsin was one of America’s leading states for unions. That seems unimaginable today, after nearly eight years under Gov. Scott Walker. Nothing better defines the Republican leader than his success crushing collective bargaining. He’s arguably America’s leading union slayer, a title Walker would probably be proud — privately, of course — to embrace.
What has that meant for Wisconsin? As a powerful new report by four economists documents, unions have been a huge factor in reducing income inequality in America, and not just for union members. The decline of unions is a key reason the United States now has the biggest wealth gap in at least a century between the super-rich and everyone else. And in recent years, no state has seen a greater decline in unions than Wisconsin.
This was always a fertile state for unions, because it ranks second in the percent of workers employed in manufacturing (which had always been the sector with the most unionized workers) and because it was the first to allow public workers to collectively bargain. A quarter century ago, in 1983, 24.6 percent of workers in Wisconsin were unionized compared to 20.1 percent nationally.
This was still one of the more unionized states when Walker took office in 2011 and decimated public unions with Act 10, and then continued what he called his “divide and conquer” strategy with a Right to Work law that makes its very difficult to organize private unions.
The result: Union membership statewide has plummeted by 38.5 percent, from 354,882 members in 2010 to 218,233 in 2016. The percent of workers unionized in Wisconsin dropped from 14.2 percent in 2010 to 8.3 percent today, well below the 10 percent figure nationally. It’s a stunning turnaround, with huge consequences for this state.
The story that emerges is one whose general outline we know, but is stunning in the new details it offers. The percent of union households grew steadily from the mid-1930s to the mid-1950s when it included about 33 percent of households, and then more or less plateaued through the 1960s, only to drop steadily from the 1970s on, declining to just 10 percent today.
And this growth period in union households, the study notes, coincided with what it calls the “Great Compression,” the period from the early 1940s to 1970, when the difference in earnings and wealth between the super-rich and everyone else narrowed significantly.
The study finds there was a consistent household income premium of 15 to 20 percent for union households over the nine decades studied, from 1936 to 2010. This union premium naturally had the largest impact on the wealth gap when the highest percent of households had at least one union member.
The data also shows unions had clear benefits for minority and lower-skilled and lower-income workers. “In the Great Compression period, when unions were at their peak and inequality at its nadir, disadvantaged households were much more likely to be union members than either before or since,” the study finds. “Unions were conferring a substantial advantage to what would otherwise have been low-income households… A similar pattern emerges for minorities: unions were relatively less white during the Great Compression.”
The study also found unions can affect the earnings of nonunion workers, as a New York Times story notes. “To capture such effects, the researchers broadened their lens to include the entire distribution of workers and their wages beyond those who are in typically unionized jobs and industries.” The data showed that “during years and in states where workers were more likely to be unionized,” overall income inequality was lower.
“While the scholars can’t pinpoint the precise mechanism at work, they speculate that unions have indirectly increased pay at firms nervous that their own employees might organize. Unions have also lobbied for higher minimum wages and pushed to hold down executive salaries. They have also advocated for broader access to health care, countering a key channel through which income inequality can harm all of society.”
Indeed, even some private sector union members supported Act 10 and believed Walker’s promise that he wouldn’t sign a Right to Work law. But once Walker won a second term, he signed the legislation.
This was only one of the many anti-worker bills Walker has signed, including repealing the 2009 Equal Pay Enforcement Act, which helped women workers victimized by wage discrimination to seek remedies; repealing a law that said employees must have at least one day of rest every seven days; Repealing the “living wage” law, which gave workers the option to demand better pay — as much as $6,000 annually — than the minimum wage; Ending prevailing wage requirements by local governments; and eliminating a child labor law rule that “16- and 17-year-olds couldn’t work more than 26 hours during a school week and more than 50 hours a week during vacations.” And Walker and Republicans have opposed any increase in the state’s minimum wage.
All these actions may help explain the reduction in average wages paid by manufacturers in recent years and the fact that that Wisconsin now has the greatest level of income inequality since 1929.
The decline of unions certainly isn’t the sole cause for this. But it was a key factor in creating the ever-growing wealth gap across America, as this new study finds. And in just eight years, Gov. Walker has made Wisconsin a national leader in killing unions and increasing income inequality.
If you think stories like this are important, become a member of Urban Milwaukee and help support real independent journalism. Plus you get some cool added benefits, all detailed here.