The Post-Dispatch ran this interesting debate on Sunday. Check out our own Paul Rainsberger.
By Steve Giegerich
Like his father before him, Dan O'Leary is a union man — 23 years a member in good standing of the International Brotherhood of Electrical Workers Local 1 in St. Louis.
Each day, countless people benefit from O'Leary's labor as an electrical tradesman whenever they trip a light switch in buildings at Washington University, the Barnes-Jewish health complex and other facilities throughout the region.
By taking advantage of the training facility that keeps Local 1 members in tune with the transition of electrical technology to the era of sustainable energy, O'Leary personifies the highly trained work force leaders tout as a major asset in the bid to lure businesses and industries capable of providing quality jobs to the region.
He also represents a critical question hovering over regional economic development efforts to lure 21st-century industry to St. Louis: Will potential employers view O'Leary and the 120,000 other members of organized labor in the region as a resource? Or a liability?
"Unions have the potential to be helpful to workers, firms and the general public," said University of Missouri-St. Louis economist William Rogers. "But unions have to be focused on improving workers' productivity. If unions are focused on extracting profits from firms and protecting workers from foreign competition, then unions will both be harmful to firms and the general public."
The question: Are unions making that transition?
Stephen Schoemehl, business manager of IBEW Local 1, says unions may edge wages up, but they bring training and dependable expertise. Rick Hafer, chairman of the Department of Economics and Finance at Southern Illinois University Edwardsville, says unions generate a "competitive disadvantage" if they're aimed only at negotiating better pay and benefits.
MEMBERSHIP DROP
Whatever the answer, union membership has dropped. Officials estimate the decline in core manufacturing has depleted the ranks of labor in St. Louis by approximately 10,000 members in the past decade.
But there is no argument that unions continue to be a powerful presence in workplaces, communities and polling places throughout the region.
Representing Teamsters, musicians, sheet metal workers and 21 other organizations, the St. Louis Labor Council currently boasts a membership of 80,000. An additional 40,000 workers are associated with unaffiliated unions, bringing the total area work force represented by organized labor to 20 percent. The national average is 12 percent.
When St. Louis Labor Council president Bob Soutier looks at the 120,000 area residents currently holding a union card, he sees a drawing card for future economic development.
Others see organized labor as a relic that has failed to keep pace with the economic realities of 21st-century business and employment.
Finally, a significant number of people in the economic development field view unions as a serious impediment to regional growth.
Mark Sweeney, a "location consultant" for corporations investigating expansion strategies in states and regions across the country, has a seat at that table.
Sweeney acknowledges that a significant number of corporations conducting business with his firm, McCallum Sweeney Consulting in Greenville, S.C., have no interest in dealing with the higher costs and workplace issues associated — unfairly or not — with organized labor.
"The overwhelming majority of clients on our client list start out with the objective of operating in a nonunion facility," said Sweeney, who has worked in economic development for 20 years.
TAGGED A UNION TOWN
The director of the Simon Center for Regional Economics at St. Louis University, Jack Strauss is arguably the area's foremost authority on local matters regarding business, economic development and job growth.
His vantage point may be slightly different from Sweeney's, but his assessment is equally blunt.
"The tag of St. Louis being a union town has hurt firms from coming in," said Strauss, making a point to single out organized labor for improving the quality of life across the region.
To make his point, Strauss cited the 1986 opening of a Toyota assembly line in Georgetown, Ky., and the decision by BMW, in the early 1990s, to open an assembly plant in Spartanburg, S.C. Both plants are situated in right-to-work states that prohibit union membership as a condition of employment.
Greg LeRoy, the executive director of Good Jobs First, a Washington-based advocate for solid economic growth, counters that foreign auto companies also established a presence in the 1980s in the traditional big labor states of Ohio (Honda), Indiana (Subaru) and Illinois (Mitsubishi).
LeRoy also dismisses the notion that fear of labor unrest drives businesses away from unionized states. In 2009, he points out, unions staged a grand total of five major strikes across the United States — the lowest in years.
"The day in which you could argue that unions deter capital investment are long gone," LeRoy argues. "Because strike activity is down."
'WELL-RUN, REASONABLE'
Even in the days when work stoppages were more commonplace, St. Louis labor coalitions were more inclined than their counterparts in New York and other cities to resolve disputes through negotiations rather than job actions, said Philip Dine, the author of "State of the Unions: How Labor Can Strengthen the Middle Class, Improve Our Economy, and Regain Political Influence" and a former Washington correspondent with the Post-Dispatch.
"They have a reputation for being well-run and reasonable," said Dine.
Even so, there is a risk that gains in regional economic development, when linked to a strong union presence, might wind up collaterally damaged by the broader public perception of unions.
That image is less than positive: In February, the Pew Research Center for People and the Press interviewed 1,400 adults and found only 41 percent of looked favorably upon organized labor, the lowest percentage since 1985.
Unfortunately for St. Louis, the movers and shakers who make decisions about location tend to agree with the general public.
The annual corporate survey by Area Development — a magazine that covers "corporate site selection and location" — determined that three out of four companies say they look for a "low union profile" in weighing whether to expand operations to a new city or state. But that factor ranked only 11th among 26 others, including labor costs, highway accessibility and tax exemptions.
COST OF BUSINESS
The findings are consistent with Ken Jacobs' assessment of where organized labor fits in the economic development equation.
The chair of the Center for Labor Research and Education at the University of California at Berkeley, he says a number of factors such as access to transportation and energy costs generally overshadow concerns over the presence of organized labor when businesses look to move.
Ultimately, said SIUE's Hafer, relocation decisions hang on a single factor.
"Unions do lots of good things to protect their employees" and elevate the standard of living, he points out. "But that raises the cost of business. And in this environment, anything that raises the cost of business probably means the business will go elsewhere."
Paul Rainsberger, director of the Missouri Labor Extension Education Program at the University of Missouri-Columbia, disagrees, contending that a well-trained, skilled work force pays for itself in terms of quality and services delivered.
Companies that opt for the other path do so at their own risk, Rainsberger cautioned.
"I don't think society benefits from the race to the bottom," said Rainsberger. "Just because something (can be produced) cheaper, doesn't necessarily mean it's better."
Nor, Jacobs added, does nonunion labor automatically translate into less-expensive labor. Some corporations view a skilled work force trained by a union as a viable and cost-saving alternative to a company's training employees in-house, Jacobs said. Training by labor organizations, he explained, also reduces costs assumed by companies that prepare workers for a specific task, only to watch them jump to a competitor.
"One thing unions do well is reduce turnover," he said. "And in doing so, they increase the incentives for firms because they hold on to workers."
ADJUSTING TO CHANGE
Sweeney, the South Carolina location consultant, points to another side of the training calculus.
Right-to-work states, he said, often dangle the incentive of publicly subsidized training programs at community colleges and other work force development centers in front of prospective businesses.
Whichever source provides training for St. Louis workers of the future, there is general agreement that the payroll checks due employees in a post-heavy manufacturing economy will come primarily from the service sector.
And the dominant sector in terms of local employment now and in the future is one that has been historically resistant to union organizing — health care.
California, Ohio and some pockets of the Northeast are starting to see nurses organize, say Jacobs and other sources.
But they agree with Soutier that the movement has yet to gravitate to the middle part of the country.
If unions do move into the local health care sector, Rainsberger foresees the bulk of the organizing taking place in extended-care centers and other medical facilities with a reputation for long hours, low pay and substandard working conditions.
Those are the working conditions the labor movement initially rose to combat. Still, UMSL's Rogers argues that organized labor has basically achieved the core principles that dictated the birth of the movement in the 1920s and 1930s — primarily providing members with livable wages along with adequate and safe working conditions. Now, he contends, the time may be ripe for unions to turn the focus on improving quality in the companies that provide their members with paychecks.
Rainsberger adds the evolution of the American economy — and the work force needed to drive it — to Rogers' argument.
"Organized labor needs to adjust to changes in the economy," he said. "And a big part of that is having relevance to emerging jobs and not just hanging on to the ones that are disappearing."
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