Is There a Role For Labor Unions in Urban Development?

9.20.12 | All eyes were on American labor this week with deals reached on new contracts for striking Chicago teachers and Verizon workers whose unions had been working with federal negotiators for months.

The role of labor unions in urban development and economic growth for metros is up for debate.  In their case study research, BRR Network Members Ned Hill, Howard Wial, Harold Wolman and colleagues examined what factors make metro regions resilient to economic or natural shocks. They found that the major determinants of whether cities are prepared to avoid and/ or respond to major shocks to the economy had to do with both with the industry structure of the region and decisions made by individual firms. But they also point to the importance of labor market flexibility and “Right to Work” laws as factors that makes regions better able to protect themselves from and respond to these kinds of changes in the economy. Right to work laws weaken the role of labor by allowing nonunion members to withhold dues to the union, even while working under a union contract.

Labor’s decline has been well documented. Naysayers point to a decline in manufacturing, globalization, jobs moving overseas and growing political opposition. While one in three American workers belonged to unions 60 years ago, today that number has declined to just 11.8 percent, and just 6.9 percent in the private sector.

But are metro regions better off without labor?

Advocates, many of whom were doing victory laps this week after the Chicago teachers prevailed against Chicago’s powerful Mayor Emanuel, say that unions have a vital role to play in ensuring a successful future for the American economy.

Writing at the American Prospect in a thoughtful and thorough piece titled “If Labor Dies, What’s Next?” Harold Meyerson forecasts that without unions America will face a shrinking middle class, declining wages, growing concentration of wealth in the hands of a few, and the growing “corporate domination of government.” All things that are undoubtedly bad for cities and regions.

And writing at the Huffington Post, labor leader Amy Dean says that government collaboration with organized labor (and others) around education and other issues could be key to enhancing the economic vitality of the city.

“The way forward is to create abundantly resourced public school systems that will push economic growth in cities and regions,” she writes. “Innovating and improving public schools helps attract middle- and upper-income families to cities and regions to build a healthy tax base. Mayors such as Emanuel should be funding public education and supporting what is already working — including strategies invented by unionized teachers — within public schools.”

Dean is a founder of the nonprofit group Working Partnerships USA, which aims to connect economic research with progressive organizing strategies.

In their research, Hill and colleagues find a limited role for government in preparing regions to respond to shifts in the economy, other than to help citizens cope with the fallout by providing training and social supports. They stress that changes in the economy take a long time, 20 or 30 years to really see industry changes. Government and political time frames, on the other hand, are much, much shorter.

But even so, Meyerson points to some innovative models where he sees hope for the role of government in working with unions and others to promote economic changes. Los Angeles in particular has been a model for these partnerships between labor and allies over the past decade, winning wage increases, union recognition, new parks, and clean-air standards, among other things.

The Los Angeles Alliance for a New Economy (LAANE) founded by Madeline Janis has been a leader in this work:

 Janis’s thesis was that businesses that operate on government-owned or -assisted properties or that have government contracts should repay the city by bettering the lives of the workers they employ and the communities in which they operate. LAANE’s first major victory was persuading the city council to require cleaning companies with which it had contracts to pay their workers a living wage—a sum several dollars higher than California’s minimum wage (or a bit lower than that if they provided their workers with health coverage). Over the years, the scope of such ordinances was broadened to encompass card-check unionization at hotels and sports arenas that received redevelopment funds; local-hiring requirements for developers of major projects; and clean-air standards for trucks at the Port of Los Angeles. Some of these ordinances have served as models for living-wage and other laws in more than 140 other cities. “A bank that makes an investment wants a return for its money, and so does the public,” Janis says. “The returns to the public should include good jobs, child-care centers, cleaner air, affordable housing.”

In their book “Just Growth: Inclusion and Prosperity in America’s Metropolitan Regions,” network member Manuel Pastor and colleague Chris Benner have a related if somewhat surprising finding that strong union representation in a region or metro actually inhibits growth and does not promote equity. This supports Hill et al.’s conclusions above, but may be a surprise to those who’ve long believed the opposite.

Their work analyses 192 metro regions and case studies and overall argues that metros can and should be presenting policies that promote both equity and economic progress at the same time.

But Pastor and Benner have a few important caveats to the finding that unions don’t promote equity that may help explain it.  They point to several factors that are related including an older workforce in dying industries, the timeframe of this study (1980-2000) which was before unions started targeting the lower-wage workers in cities like Los Angeles and finally, that “equity” as they define it is focused on those in the bottom rungs of the income ladder, and unions in this period of time were not primarily focused on that group.

Meyerson’s history of labor’s organizing strategies then and now also provides interesting background here. You can read his full article at The American Prospect. Don’t miss the interactive labor history timeline. And Barbara has a thorough analysis of Just Growth in this BRR post.


Photos/ sarah-ji

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