1. Chapter 9 - Labor Chapter 9 Section 1 Organized Labor
Labor Unions in the US
Labor union decline lately
Types of unions
Collective Bargaining/ Strikes

2. Labor and Labor Unions Labor powers the US economy
Most people are employees, not employers
Employees have little control over conditions of their work
Hours
Wages
Safety

3. Labor Unions
Organization of workers that tries to improve working conditions, wages, and benefits
When employees get together, they can bring their concerns to management
Less than 14% of workers in the US belong to a union
About 42 Million people

4. 3 Types of Unions 1. Closed Shop 2. Union Shop
Hires only union workers
Illegal today
2. Union Shop
Will hire non-Union workers, but will require them to join the union within a certain amount of time

5. Types of Unions 3. Agency Shops
Will hire non-union workers and will not require them to join in order to keep their jobs
Still must pay fees similar to the dues
Covered by the contract as well
Free Rider problem?
Join the union for the protection and benefits, and not have to pay

6. Rise of the Labor Unions
The plight of Workers
Labor unions sprung from Industrial Revolution
12-16 hour days, 7 days a week
Long days at dangerous machines
Many lost sight, hearing, fingers, limbs, lives
To protect their interests workers started banding together
Striking - organized work stoppages in order to get their demands met

7. Knights of Labor 1869 Garment workers in Philadelphia
Grew to be a powerful organization
An industrial union
Workers in a single industry who perform a variety of jobs
1880s disputes over strategy started the decline

8. American Federation of Labor
Samuel Gompers
Considered the father of American labor mov’t
Wanted three things
Higher wages
Shorter hours
Safer work environment
Federation of Craft workers
Organization of workers in a single/similar occupation
Trade Union

9. Resistance to Unions Viewed as threats to free enterprise early
Sherman Antitrust Act?
Union workers were often fired
Yellow dog contracts
Injunctions were used to get workers to end strikes
Militias hired

10. Congress and Unions Until the 1930s, unions had no real protection
National Labor Relations Act (Wagner Act)
Gave labor the right to organize/bargain
National Labor Relations Board

11. Congress and Unions 1938 - Fair Labor Standards Act
Created minimum wage
Outlawed child labor
Overtime for over 40 hours of work
First Nationwide mandatory regulation of wages and hours
1950’s saw a peak in union membership
Nearly 30% of employees
Gained Billions in dues
Became very powerful groups

12. Decline of Unions With this new power came abuse
In order to protect jobs (technology)
Corruption – Teamsters

13. Decline of Unions 1. Structural changes in US economy?
Blue collar vs White collar
(Hourly vs salary)
2. Manufacturing over seas
3. Women in the workforce
Statistically less in blue collar jobs
4. Movt of company to different areas of the country (Less union activity in the South)
5. Goals fulfilled
OSHA and other Govt programs

14. Collective Bargaining
Process by which union and company representatives meet to negotiate a new labor contract
Contracts last 2-5 years
Union will usually come with goals
Wages
Overtime, raises, benefits
Ask for too much, company may have lay offs
Seniority

15. Collective Bargaining
Working Conditions
Safety, comfort
Job Security
What can get an employee fired
Grievances
Strikes
Generally occurs when there is a deadlock

16. Strikes Members will vote Can be bad for both sides Mediation
“strikebreakers”
No pay checks
Don’t normally happen until contract expires
Mediation
Neutral third party comes in to find solution
Nonbinding agreement
Arbitration
Third party decision that is legally binding

17. 9.2 Labor and Wages Who makes up the labor force
Supply/Demand and Labor
Wages and skill level

18. Labor Force
Labor force is made up of all nonmilitary people who are employed or unemployed
Employed - must be 16 and meet one of the following
Work at least one hour for pay within the last week
Worked 15 or more w/o pay in a family business
Have a job, but did not work due to illness, vacation, labor disputes, or bad weather

19. Labor Force
Unemployed - 16 or older, not institutionalized, not currently working and meet one of the following
Temporarily laid off
Will report to work a new job within 30 days
Not working but have looked for work within the last 4 weeks
To be counted as unemployed, you must actively be looking for a job
People who do not want jobs (stay at home parents, retirees) are not considered unemployed

20. NO NO NO NO NO Unemployed? Retired Grandfather? Stay at home mom?
Thief serving time in prison
Friend in the military?
Full Time College Student? NO NO NO NO

21. Supply/Demand and Labor
Labor demand
Govt and private industries that produce goods and services
Provide the jobs to workers, along with pay based on productivity (value of output)
If one company pays more for the same work?
Pay More – or -
Buy more machines
ATM
Assembly Lines
Self Service Gas Stations

22. Supply/Demand Labor Workers response to low wages Labor Supply
Look elsewhere
Threaten to or actually strike
Find a new career
Labor Supply
Higher wagers will draw more workers
Equilibrium Wage
No excess and no shortage of workers

23. Wages and Skill level
Unskilled Labor - no specialization, education or skills
Usually will earn an hourly wage
Semi-Skilled - minimal special skills or education
Usually get an Hourly Wage
Skilled Labor - Special skills and training
Usually earn an Hourly Wage
Professional Labor - advanced skills and education
Generally salaried positions

24. Wage Discrimination Part of our nation’s history
Men need more money to support family
Women work for extra money
Racial and ethnic prejudices as well
African Americans and other minorities paid less
Equal Pay Act of 1963
Male and Female workers must be paid the same

25. Wage Discrimination Civil Rights Act 1964-
Title VIII of the Act forbids job discrimination based on race, sex, color, religion, or nationality
Affirmative Action
Policies to ensure inclusion of minorities and women in hiring, college admission, and issuing of govt contracts
Equal Employment Opportunity Commission
Handles complaints of discrimination

26. Women and Wages Women still earn about 75% of what men earn Why?
Women’s Work - encouraged to find jobs in lower paying fields
Human Capital - generally less educated or experience
Career paths offered - many companies do not feel that women really want to be managers

27. Women and Wages
Glass ceiling - unofficial, invisible barriers that exist which limit opportunities for women
Lily Ledbetter
Paid anywhere from $500 - $1500/month less than her male counterparts

28. Minorities and wages Make less than whites Less access to education?
Less work experience?
Denied entrance to jobs (discrimination)

29. Wages and Unions Union members do make more than nonunion
made $160 more/week
Pensions and medical benefits
Unions drive wages down?
Unions demand raises
Quantity of labor demanded goes down
Union workers laid off, have to go look for nonunion jobs
Bigger supply of nonunion workers makes wages go down

30. Featherbedding Keeping unnecessary workers on company payroll
Caboose-men

31. Ch 9.3 Labor Market Trends Occupational trends
US - farming to manufacturing to information age
Shift from manufacturing to service industry
Banking, insurance, investment
Online/Internet
Health care

32. More service jobs, less manufacturing jobs
Need for a more educated work force
Less unskilled and semi-skilled jobs
High school education will not go as far today as it used to
1950’s typical workers only had HS education

33. College and work
A college education is unattainable for many Americans
64% go to College, only 29% earn a bachelor degree
College degree can double your earning potential
Higher education = higher wages
Learning effect - education increases productivity and wages
Screening effect - completing college proves intelligence and work ethic. People with these attributes do well in school and keep going to school

34. Women’s labor trends 1960 - 38% of women worked 1997 - 60% +
More women encouraged to go to college
Gender roles have changed
Households have changed

35. Households
Higher education = More income, more incentive for women to continue education
Housework is easier with new technology
Less time needed to take care of the house
More income needed to live comfortably
Costs increase faster than wages
Divorce rate

36. Temps Contingent employment
Hired to perform a specific job, then released
Usually earn less than permanent employees, but can be successful
% of workers
Benefits to hiring temps
Flexible lay offs - no severance pay/less rights
Cheaper - $ and benefits
More freedom as a temp
Move around to different jobs

37. Earnings have actually gone down
$275/week*
$261/week*
Average*
College grads earnings have increased
No college - decreased
Competition from overseas has taken low skilled jobs
Deregulation has driven wages down
Benefits are expensive - costs more, pay less
Social Security matched by employers