Unions Will Have To Reinvent Themselves To Survive

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If, like many Americans, you have left your land-line phone to gather dust while you explore the joys of wireless technology, you may be unaware that a major strike is now underway across the Eastern Seaboard. Indeed, the strike of 45,000 Verizon land-line technicians has received relatively little attention in the press, even from the usual boosters of union power against evil corporations. Megan McArdle has an interesting take on the situation:

Margins seem to be improving in the wireline business, thanks to FIOS; people will pay much more for a high-speed internet connection than they will for a telephone.  But landline subscriptions continue to fall, and last I heard, the company had decided not to expand its FIOS network into new cities after it finishes the current rollout.  Most of the profits the people on the picket line keep referring to come from the booming wireless business, which is a non-union joint venture.

In other words, while profits have recovered since 2008, the striking workers aren’t generating those profits.  In fact, the legacy network of copper wires they service is rapidly turning into a cost centre rather than a source of profits.  They’re essentially asking that the firm divert money from the wireless business to beef up pay and benefits for the union workers even as the number of subscribers they have to service is falling.  It’s not really surprising that management is saying no.

Heading forward, this is likely to become an increasingly common phenomenon. Private-sector unionization rates have fallen dramatically over the past 50 years, and the sectors in which unions remain strong tend to be older legacy industries rather than the modern ones that drive economic growth. More, unions often preserve the benefits of older workers at the cost of “second tier” benefits for new ones — pretty much ensuring their death in the not so distant future.

Unions can strike over land lines, but they have no power over internet or cell phones. The past few years have seen unions scramble to cling to power in the industries where they have it — this may not matter if the industries themselves disappear.

If unions are going to survive — and there are good reasons why workers should band together — they are going to have to re-invent themselves.  Suppose unions thought about ways to add value, or supported worker training that actually worked?  Suppose union representatives tried to think about how a union could add value for an employer and built strategies around that?  Suppose unions were more like worker associations that didn’t so much try to keep workers employed at one firm forever but acted as career advisers/facilitators/managers who helped workers navigate the economic shoals, shift to new careers and perhaps ultimately set up as independent small businesses on their own?

American workers could use some help; if the legacy labour movement can’t provide that — and 30 years of ineffective flailing about suggests strongly that it can’t — someone else needs to figure out how.

The economy has changed but workers still have important interests and unmet needs and there are many problems that people can solve better in groups and associations rather than on their own. There is a huge opportunity here for original and creative approaches to an important social need; idealistic young people who care about workers need to get out of the failing legacy labour movement and start something new.

This post originally appeared on The American Interest.