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Posted: 7:37 a.m. Friday, May 22, 2009

RANDOM FACTS ABOUT LABOR UNIONS 

By Neal Boortz

The Heritage Foundation has a great analysis on how labor unions affect jobs and the economy.  What I've done is pulled just a few facts that you should know about these unions.  Read the linked study for more information.  This one needs to be framed and put on a wall.  Ready?  OK .. here is what labor unions do for American business:

 

  • Studies typically find that unionized companies earn profits between 10 percent and 15 percent lower than those of comparable non-union firms.

 

  • Some unions win higher wages for their members, though many do not. But with these higher wages, unions bring less investment, fewer jobs, higher prices, and smaller 401(k) plans for everyone else.

 

  • Final union contracts typically give workers group identities instead of treating them as individuals. Unions do not have the resources to monitor each worker's performance and tailor the contract accordingly. Even if they could, they would not want to do so. Unions want employees to view the union--not their individual achievements--as the source of their economic gains.

 

  • Consequently, union contracts compress wages: They suppress the wages of more productive workers and raise the wages of the less competent. Unions redistribute wealth between workers.

 

  • A better summary of the economic research is that unions do not increase workers' wages by nearly as much as they claim and that, at a number of companies, they do not raise wages at all.

 

  • In essence, unions "tax" investments that corporations make, redistributing part of the return from these investments to their members. This makes undertaking a new investment less worthwhile. Companies respond to the union tax in the same way they respond to government taxes on investment--by investing less.

 

  • Research shows that unions directly cause firms to reduce their investments. In fact, investment drops sharply after unions organize a company. One study found that unionizing reduces capital investment by 30 percent--the same effect as a 33 percentage point increase in the corporate tax rate

 

  • The balance of economic research shows that unions do not just happen to organize firms with more layoffs and less job growth: They cause job losses. Most studies find that jobs drop at newly organized companies, with employment falling between 5 percent and 10 percent.

 

Wonderful stuff, don't you think?  Really makes you want to go to work for a unionized company.  Not.

 
 

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