Citibank, BOA, Wal-Mart, Burger King, and a couple hundred other U.S. Chamber of Commerce companies are prepared to spend $200 million on advertising and lobbying to block the Employee Free Choice Act. They're also saying some pretty strange things in the process, according to economist Dean Baker.
Recently, they have sought to promote the argument that unions lead to higher unemployment. To help push this case they have been circulating a study that examines differences in unionization rates and unemployment among Canadian provinces. This study purports to find that a 3 percentage point increase in unionization rates leads to a 1 percentage point increase in unemployment. Based on this study, the opponents of the Employee Free Choice Act argue that any resulting increase in unionization will cost millions of jobs.This propaganda is actually being pushed by "something called the Alliance to Save Main Street Jobs" — an alliance that happens to include that bastion of "Main Street," the U.S. Chamber of Commerce."
Baker questions their reasoning:
Of course the immediate response might be to ask, if this study's findings are accurate, why Canada's unemployment rate isn't 7 percentage points higher than the U.S. rate? Canada's unionization rate is about 20 percentage points higher than in the U.S., yet its unemployment rate is somewhat lower.He also goes on to point out that there's a large body of research on this topic, and the most recent research finds no link between unemployment and unionization rates.
In 2006, the Organization of Economic Cooperation and Development (OECD) did an exhaustive analysis of the research on this topic and concluded that there was no link between unionization rates and unemployment. It is easy to find examples of countries with very high unionization rates and low levels of unemployment. For example Norway and Denmark have unionization rates near 80 percent. Before the current crisis their unemployment rate was under 3.0 percent.Unions don't lead to higher unemployment, but the act of unionizing can lead to firings. According to the Center for Economic and Policy Research, "our estimates suggest that almost one-in-five union organizers or activists can expect to be fired as a result of their activities in a union election campaign. Since 2000, illegal firings have marred over one-in-four NLRB-sponsored union elections, reaching 30 percent of elections in 2007."
Of course we don't have to go overseas to prove the case that unions don't lead to unemployment. If we go back 40 years, the unionization rate was over 30 percent. Presently, it is just over 12 percent. In the 60s, the unemployment rate fell as low as 3.0 percent and was below 5.0 percent for most of the decade.
That's why we need to pass the EFCA. It would strengthen penalties for companies that coerce or intimidate employees when they try to form a union, but more importantly, it would help revive America's middle class. And that's what scares corporate America. They want all the profits for themselves.
(To learn more about the EFCA, read Citizen K's excellent post on the subject. His money quote: "Passing EFCA is not only an important step for unions and employees who want to unionize, it's an important step for anyone with a job.")