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Stephen Glasscock Glasscock 1
BAS 267
Counts
11/26/2018
State of the Unions
In the early 1930’s a man by the name of Jimmy Hoffa led his first of many labor strikes.
Hoffa was working for a grocery store chain in Detroit, Michigan at the time, and he and his co-
workers refused to unload a fresh shipment of strawberries until they had landed a better
contract (Biography.com). Hoffa became a rising star amongst the labor unions, eventually
joining the International Brotherhood of Teamsters, and working his way up to the presidency
of the Teamsters’ in 1957 (Biography.com). Hoffa is also known for having brought together
almost all of the truck drivers in North America under one contract, which has been declared as
his most decisive victory (Biography.com). Although Jimmy Hoffa is the most popular union
organizer, the impact that labor unions have had on the United States economy, existed long
before, and long after, Jimmy Hoffa.
“The essence of what labor unions do—give workers a stronger voice so that they can
get a fair share of the economic growth they help create—is and has always been important to
making the economy work for all Americans,” (Madland and Walter). Labor unions are
probably best known for helping workers get increased wages. Back in 1886, Samuel Gompers
and the American Federation of Labor (AFL), successfully negotiated wages increases for its
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members and enhancing workplace safety for all workers (Unionplus.org). What the AFL was
doing in 1886, started a trend that is still happening today. Unionized workers were receiving
11.3 percent higher wages than non-union workers, from the years 2004-2007 (Madland and
Walter). When worker’s wages grow, so does the economy. “Throughout the middle part of
the 20th century—a period when unions were stronger—American workers generated
economic growth by increasing their productivity, and they were rewarded with higher wages,”
(Madland and Walter). If this trend had continued, and workers were compensated for 100
percent of their growth in labor productivity, average wages would be around $28.53 per hour
(Madland and Walter). This is what created the middle class in the United States. And, of
course, the more money that workers can earn, the more money they will spend. As Rick
Rieder explains, “The combination of rising wages and reduced goods prices (led by
technological innovations) are paving the way for increased household savings at the very
moment when the financial needs of a growing pool of retirees is set to crest and the cost of a
college education is becoming ever more of a challenge. In fact, for the first time in a
generation, consumer confidence among the lowest-income brackets is rising faster than that
of higher-end earners,” (Rieder).
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The increased wages that unions offer allow workers to have some financial freedom.
The workers are able to retire more comfortably, buy a new home, or help to pay for their
children to attend college. The increase in wages provided by unions, also effects non-union
employees, because non-union employers will often follow the pay standard set by unions. “For
example, a high school graduate whose workplace is not unionized but whose industry is 25%
unionized is paid 5% more than similar workers in less unionized industries,” (Walters and
Mishel). Increased wages are not the only benefit that comes from unionized labor.
Unions also increase the chances that workers will be given employer provided benefits.
Nationwide, union workers are 28.2 percent more likely to carry health insurance paid for by
their employer, and 53.9 percent more likely to have an employer-provided pension (Madland
