President Joe Biden’s American Jobs Plan contains many elements that will prime America’s economy for faster, stronger and more equitable growth, including investments in roads, water systems, electric grids, child care and home care. Among its most important reforms, however, are those that would make it easier for workers to join a union and bargain collectively.
Promoting unions is the hidden linchpin of the president’s plan because creating good jobs is not just a matter of increasing economic growth. In today’s economy, workers need more power to ensure that economic growth translates into better conditions.
It is true that on their own, the bill’s investments would help promote full employment — and tight labor markets tend to lead to pay increases. Indeed, during the full-employment period of the late 1990s, the incomes of high-, middle- and low-income workers increased relatively rapidly and at similar rates.
But “full employment” may not mean as much for Black workers — whose unemployment rate is usually about double the white rate — or for women, who are particularly likely to have lost jobs during the current pandemic. Compounding these problems is that over recent decades, as corporations have become even more powerful and workers less so, there are signs that full employment may no longer do as much as it used to. During 2017, the unemployment rate in the United States was about as low as it had been in over 50 years, yet wages remained stagnant, barely increasing any faster than inflation. Similarly, in 2018, when the unemployment rate fell even lower, growth for median wages was well below the levels of the late 1990s.
More generally, the fact that wages have decreased since the 1970s for many groups of workers, such as low and middle-income men – in spite of several periods of very tight labor markets – suggests that more is needed. In addition, as I highlight in my forthcoming book, “Re-Union: How Bold Labor Reforms Can Repair, Revitalize, and Reunite the United States,” evidence over recent decades from Canada, Britain and Australia also suggests that tight labor markets are not enough on their own to significantly boost compensation for workers throughout the income distribution.
Unions and collective bargaining can ensure that tight labor markets translate into real workplace improvements for all workers, no matter their race, ethnicity, gender or sexual orientation. They can also help ensure good working conditions even when the economy is not running hot. Unions also increase the democratic power of workers — by increasing voter turnout, especially among low-income workers, and by providing an important behind-the scenes voice, just like corporations and the wealthy have — so that policies can be more responsive to the interest of workers.
The American Jobs Plan seeks to promote unions through several measures, including the Protecting the Right to Organize Act, which would guarantee union and bargaining rights for private-sector workers. The jobs plan would also seek to ensure that employers benefiting from public investments follow strong labor standards, such as prevailing wage laws and not unfairly preventing workers from taking collective action. Pro-union measures are needed because current law is unfairly tilted against workers who want to join a union.
As important as pro-union policies are, they will face a steep challenge in the U.S. Senate, where the filibuster gives a minority of senators the power to block the majority. Still, a handful of Republicans in the House of Representatives – along with virtually all Democrats — recently voted in favor of the PRO Act. Alternatively, there are tools that the Senate majority could use to help ensure pro-union provisions remain in the bill, such as the budget reconciliation process which allows spending bills to pass with a simple majority.
Whatever the legislative strategy, pro-union provisions are essential in order for the American Jobs Plan to fulfill its promise to foster good jobs and “rebuild a new economy,” as Biden seeks to do.
David Madland is the author of “Re-Union: How Bold Labor Reforms Can Repair, Revitalize, and Reunite the United States,” and is a senior fellow at the Center for American Progress.
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