From SeaTac to Chattanooga, tracing the links between the minimum wage and union organizing in the South

By: Richard S. Davis
12:00 am
February 19, 2014

Small elections have big consequences. We know that in Washington. Consider the SeaTac Prop. 1 vote for a $15 minimum wage (and a host of other labor-protection measures) and  the Boeing Machinists vote that secured the Boeing 777X work here.

A similarly consequential vote took place at the Volkswagon plant in Chattanooga, Tennessee, last week. Auto workers there rejected joining the UAW.

The thread that links these three pivotal elections, decided by thin margins and small populations, is a labor movement struggling to adapt to changed conditions, as I write in my column today.

Regarding the minimum wage:

Unions seeking to organize service, restaurant and hotel workers promote the $15 minimum wage, often through affiliated and relatively unregulated “worker centers.” While the boost will cost some workers their jobs, the unions see several wins.

Raising the statutory wage floor shuts out young and inexperienced workers, those least likely to become union members, and drives up labor costs, reducing the comparative advantage of nonunion employers. And it boosts income for unionized workers with collective bargaining agreements linking base pay to the minimum wage.

The Boeing Machinists and the VW autoworkers both responded to competitive realities. A contract modification was necessary to land the 777X here. In Tennessee, a successful automotive cluster and good wages at VW made unionization both unnecessary (workers were satisfied) and risky (opponents warned of the role the UAW played in Detroit).

As private sector labor unions adapt to an environment shaped by globalization, new technologies, and interstate competition, new techniques are emerging. In the column, I conclude,

Organized labor is in an existential crisis, one which will produce an array of adaptive behaviors: worker centers and works councils, minimum wage advocacy, card check over secret ballots, and more. It’s likely that many of the evolving strategies will get their test run in the Puget Sound metro area.

For other views on the VW vote, see this editorial in the Tennessean, George Will’s column  (he calls the Chattanooga vote the most important election of the year), Holman Jenkins’ WSJ column, and an AEI assessment of what it means and what’s next.
Categories: Categories , Current Affairs , Economy , Employment Policy.
Tags: Boeing Machinists , Chattanooga , labor , minimum wage , SEIU , Tennessee , UAW , union , VW