Thursday, 07 February 2013 16:30

Unions Left Out of U.S. Manufacturing Growth

Companies like Apple and General Electric are bringing American manufacturing jobs back home or creating new opportunities – but with weakened unions, that’s not necessarily a good sign for wages and the economy.

manufacturing-us300The new trend in "reshoring" is primarily motivated by the same reason companies went big for outsourcing - savings to the personnel line. As China continues to modernize and burn through natural resources at an alarming rate, the birth rate is going down, leading to a labor shortage that is driving wages up. But wages in the U.S. continue to decline relative to inflation.

Apple announced near the end of last year that they would create manufacturing jobs in the U.S., joining General Electric and other big corporations in the reshoring trend. But U.S. manufacturing is returning to a weakened landscape for organized labor.

Half a million new manufacturing jobs were created since President Obama began office, but fewer of them are unionized than in the past. According to federal survey data, all of the job gains in manufacturing have been non-union. As the economy makes a gradual recovery, these new non-union jobs offer salaries that are about seven percent lower than what similar workers receive who have union representation.

Political battles such as those in Wisconsin, Indiana, and Michigan have damaged unions with efforts to block collective bargaining and cut union funding. And there continue to be far fewer jobs than workers looking to fill them, allowing companies to keep wages low and unions out.

Depressed manufacturing pay adds to the overall burden new low wage jobs place on the recovery, with the majority of jobs paying under $14 an hour, and keeps the middle class from opening their wallets.

It’s yet to be seen how Apple will approach reshoring. But the company will continue to outsource from Foxconn, the major technology supplier in China known for horrific labor conditions that reportedly drove many workers to threaten or commit suicide. Since the abuses at Foxconn came to light in the international media, Apple has taken steps to clean up its supply chain.

Following recommendations from an international panel hired by Apple to audit conditions for Foxconn’s 1.2 million workers, Foxconn has announced they will deepen employee involvement in union elections, and hopes to impact labor standards throughout China.

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