The Stubborn Facts on the Economic Impact of Right-to-Work Laws

Michael Wasser is American Rights at Work’s summer 2010 research intern.

Proponents of so-called “right-to-work laws,” such as the U.S. Chamber of Commerce and the National Right to Work Committee, argue that they create a more business-friendly environment and lead to economic growth for states and their residents.

But is that really the case?

As Jack Hough noted in a recent Smart Money article, new research suggests that the supposed economic benefits of right-to-work laws may be little more than useful rhetoric for the law’s supporters.

Because of a provision added to the National Labor Relations Act in 1947 through the Taft-Hartley amendments, states may pass right-to-work laws. These laws ban agreements stipulating that all employees represented by a union have to pay dues. Right-to-work laws currently are on the books in 22 states.

The new research on the economic effects of these laws comes from Lonnie Stevans, Professor of Information Technology and Quantitative Methods at Hofstra University. He compared 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.

As the Smart Money article states:

Stevans found that RTW [right-to-work] states had lower per-capita income for workers, but higher income for business owners, than non-RTW states… According to Stevans, there’s little evidence of a ‘trickle down’ of benefits in RTW states from business owners to workers.

He also didn’t find evidence that right-to-work legislation affects the states’ employment rates.

Professor Stevans’ findings cast a pall of doubt over the economic claims of right-to-work supporters. Though their talking points may remain unchanged, the fact is right-to-work laws do not improve the economic viability of states and their workers. And as John Adams once said, “Facts are stubborn things…”

UPDATE: You can download a summary of Professor Stevans’ research here.

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This entry was posted on Thursday, August 26th, 2010 at 1:14 pm and is filed under Anti-Union Network, General. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

12 Responses to “The Stubborn Facts on the Economic Impact of Right-to-Work Laws”

  1. Anonymous says:

    Twitter Trackbacks…

  2. eatmeufcwliers says:

    Oh boy where to start. The UFCW is trying to get into our plant and I can honestly say that there is a overwelming NO NO NO union in our plant and maybe a handfull of people who are for it so GUESS WHAT THAT MEANS?? they are lieing there selvs to death,,we have some 30 cameras in our plant that will prove that all of the lies the UFCW has told about us and the company WILL COME OUT IN THE END..There should be aa LAW against the unions filing lies,claims,untruths about the companies they are trying to bankrupt at the NLRB..STOP THE ABUSE

  3. Charlie says:

    TO: eatmeufcwliers. You are so wrong and plainly uninformed when it comes to knowing a damn thing about unions or you are a company stoog. Unions are good for workers, they improve wages and working conditions. Unions are good for companies, they force companies to improve and update operations and their workforce is happy, productive and work hard to make the company successful. No union nor union member in their right mind would want to organize a company to run them out of business. Your logic is no logic at all. Study your history and get in the boat for your own economic welfare. I have been retired for over 18 years and I have over 55 years paying full dues to my union, the Machinists. I don’t have to pay those dues in retirement but I am most happy to do so. It’s for people like you, the uninformed I still have hope for.

  4. joe conti local 25 retiree says:

    TEAMSTER UNION LEAD THE WAY FOR WORKING PEOPLE IN ALL PHASAS HEALTH AND WELFARE PENSION WORKING CONDITIONS AND THERE TEAMSTER OFFICIERS DO A GREAT JOB ENFORCING THE CONTRACTS ALONG WITH THE HELP FROM GREAT STEWARDS ALSO RETIREES PLAY A BIG PART IN ALL THEY DO TODAY AND YEARS BEFORE STAND TALL,PROUD AND STRONG AND MOST OF ALL ALWAYS BE PROUD OF YOUR TEAMSTER LOGO WEAR IT I DO AND MY LAST DAY OF WORK WAS 1-31-1996 ALWAYS HAVE AND WILL BE TILL THE DAY I DIE A STRONG UNION MAN

  5. Yolanda wife of a teamster says:

    I will have to admit …THANK GOD FOR UNIONS. No they are not perfect but if my husband was not a member of a union we will not be in our home today. He has been on his job for 25 years and when the recession hit he would have been one of the first people to go. Lets face it why pay him when his company can bring in 2 young people for his salary. My son is also a union member at 21. He has a little pension he is building, health benefits and a job that has given him raises in the last 2 years while others are losing income. We all need someone to keep the companies honest.The past couple of years should have shown everyone that by now.

  6. Lawrence says:

    All I have to say is that after 35 years in the teamster’s, with all the ups and downs in this great country; it seems like everyone wants to get rid of the unions. Don’t froget what the unions have done for you and evry now union worker in this country, If not for the unions your wages and benifits would be half of what you earn or receive now. But big business would be reaping billions more than what they are doing right now. I have been retired for 8 years, thank you TEAMSTER UNION. Larry

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