So-called “right-to-work” laws hurt working families' pocketbooks and drive down overall living standards in communities. By weakening the voice of workers and their ability to negotiate through their unions, right-to-work laws drive down the wages of an average worker by $5,333 a year, according to the U.S. Department of Labor. What’s worse, right-to-work laws fall hardest on women and minorities, whose wages suffer the most as a result. These laws make it easier for “low-road” companies to win out by offering poor wages and benefits, and despite claims to the contrary, have not been found to improve business conditions in states. As Rev. Martin Luther King Jr. put it, right-to-work “provides no rights and no work. Its purpose is to destroy labor unions and the freedom of collective bargaining.”
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Wrong for Everyone.
A review of recent research on the impact of "right-to-work" laws, including the following findings:
RTW laws don’t generate jobs, economic growth
Prior research on RTW employment growth was inaccurate
RTW laws lead to declines in workplace representation and wages
If more states enact RTW laws, economic recovery is at risk
Download the full review.
Erin Johansson and Michael Wasser, American Rights at Work, UPDATED January 2012.
Since the 1947 passage of the Taft-Hartley amendments to the National Labor Relations Act, which allowed states to ban agreements stipulating that all employees represented by a union had to pay dues, 22 states have passed these so-called “right-to-work” laws. Proponents of right-to-work laws claim that they enable a more business-friendly environment and lead to economic growth for states and their residents.
Lonnie Stevans, Professor of Information Technology and Quantitative Methods at Hofstra University, tested this claim by comparing the business formation and economic growth of right-to-work states with non-right-to-work states using recent data from the U.S. Small Business Administration. Stevans controlled for variables like education levels, population changes, and type of employment in the states to accurately measure the relationship between right-to-work laws and economic growth.
Stevans found that a state’s right-to-work law:
- Has no impact on economic growth
- Has no influence on employment
- Has no influence on business capital formation (the ratio of firm ‘births’ to the number of firms)
- Is correlated with a decrease in wages
Stevan’s analysis of right-to-work states also yielded the following observations:
- The average real state GDP growth rate of right-to-work states is not significantly different than non-right-to-work states
- The average per capita income in right-to-work states is lower than in non-right-to-work states
Stevans concluded his analysis with the following observation:
“…From a state’s economic standpoint, being right-to-work yields little or no gain in employment and real economic growth.”
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Lonnie K. Stevans, Hofstra University, REVIEW OF LAW AND ECONOMICS, 2009.