It is CEI’s contention that strong labor regulation, including collective bargaining mandates, is detrimental to general welfare, as it prioritizes the wants of union leaders and their supporters over the needs of other citizens.
Lowell Gallaway and Jonathan Robe demonstrated this in our High Cost of Big Labor study (PDF), which calculated the deadweight loss of artificially increasing the cost of labor in unionized industries and thereby increasing the supply of labor in nonunionized sectors, in turn increasing unemployment. The study found significant hits to GDP and real per capita income in unionized states over half a century. As we said at the time, “Those conclusions provide a strong case for viewing the passage of the Wagner Act in 1935 as a case of causing long-term economic trauma.”
There is new evidence that suggests that economic harm was not the only negative effect of collective bargaining mandates. Researchers from Cornell University recently reported significant harm to the educational attainment and skill levels of men, especially minority men, as a result of collective bargaining by teacher unions:
We find robust evidence that exposure to teacher collective bargaining laws worsens the future labor market outcomes of men: living in a state that has a duty-to-bargain law for all 12 grade-school years reduces male earnings by $1,493 (or 2.75%) per year and decreases hours worked by 0.52 hours per week. Estimates for women do not show consistent evidence of negative effects on these outcomes. The earnings estimates for men indicate that teacher collective bargaining reduces earnings by $149.6 billion in the U.S. annually. Among men, we also find evidence of lower employment rates, which is driven by lower labor force participation. Exposure to collective bargaining laws leads to reductions in the skill levels of the occupations into which male workers sort as well. Effects are largest among black and Hispanic men, although white and Asian men also experience sizable negative impacts of collective bargaining exposure. Using data from the 1979 National Longitudinal Survey of Youth, we demonstrate that collective bargaining law exposure leads to reductions in measured cognitive and non-cognitive skills among young adults, and these effects are larger for men.
Unions ensure the misallocation of funds meant to improve the education and skills of young people.
As I argued in my 2011 book, Stealing You Blind, there are plenty of ways in which teacher unions harm students. From forcing the firing of young, keen teachers to enable the retention of older, burned-out teachers, to the maintenance of “rubber rooms,” where teachers are paid not to teach, teacher unions ensure the misallocation of funds meant to improve the educational attainment and skills of young people.
As I noted at Instapundit, “My children’s old middle school principal (a real innovator) used to say that he loved teachers’ union states —because he could visit them and recruit good, hungry young teachers whose careers were stymied by union rules.”
At a time when minimum wage laws are causing opportunities for unskilled young people to disappear, it is all the more vital that education provides our children with the skills they need to succeed. If teacher unions’ privilege to bargain collectively harms that process, there is all the more need for states to pass right-to-work laws.
Reprinted from Competitive Enterprise Institute.