The Signal October 22, 2021

Fair Pay & Unions: Striking is Not Enough

Workers have the power now and should expect better pay but unions’ itch to strike over a few dollars could blow this chance to re-define the deal for labor. Push for more investment in the future of work and a voice in business strategy.

Kevin O'Marah Avatar
Kevin O'Marah

The Today show this week featured a three-minute segment on the supply chain “crisis” with a focus on the leverage workers suddenly have over employers. Amazon's call for thousands of seasonal hires at an average wage of $18 per hour with a $3000 signing bonus was the money-shot (no pun intended) meant to prove that labor is holding all the cards now. How likely is it that unions will play their hand well?

Image showing an Amazon log, with the headline reading, "America's holiday supply crisis."

Scabs, Thugs and the Mob – Old School Unions Won't Work

Manufacturing and logistics are traditional hotbeds of 20th century unionism featuring icons like the Teamsters, United Auto Workers and United Food and Commercial Workers who have 3 million members among just these three. Strike activity is nearly double last year according to Time Magazine with big name targets including John Deere and Kellogg's making news. It seems to be working with Nabisco upping wages by 60 cents an hour, yearly for the next four years, plus $5000 cash. 

While this is good news for workers and probably justifiable enough for employers, the instinctive reaction of too many professors of Industrial Relations feels like cheerleading for a return to the barricades. This quote from Adam Seth Litwin, a professor of industrial and labor relations at Cornell University is typical:  

“Workers are right to think the ball is in their court. They need to take a really big bite of the apple right now, because whatever they get they're going to have it in their mouth for a long time.” 

And the accompanying comment from Dan Osborn, Omaha chapter president of the Bakery, Confectionery, Tobacco Workers and Grain Millers International Union, sounds like a call to arms: 

“It's become more of a movement than ever before. The more we win, the more we're going to continue to win.”

The sentiment is rousing, but a return to the strike/lockout cycles of 1970's Detroit or Britain's Winter of Discontent won't make anyone better off. Old school unions with “Mob ties” and a Woody Guthrie-inspired sense of class struggle may have won some big concessions then, but at the expense of operational inflexibility that nearly (or actually, in the case of the UK's industrial manufacturing base) killed the goose that laid the golden egg.

Agility with Stability is a Better Goal for Strong Unions Now

Industrial Relations is hostile in the Anglo world (UK, US, Australia, Canada). It's all about struggle, which is understandable given the history, but is exactly the wrong approach to getting a “big bite of the apple”. For contrast, consider the approach taken in Germany where IG Metall represents workers, but in a collaborative relationship with employers in which recent job cuts at Siemens Energy drove the World Socialist Website to lament

“IG Metall are not pursuing the goal of defending the wages and jobs of the workforce, but of ‘helping to shape the transformation,' i.e., restructuring Siemens and other corporations so that they will continue to yield high profits in the future.” 

The socialists are incensed, but Siemens, which was founded in 1847, will carry on, and German workers, who have more holiday, training, social support and general respect than their Anglo counterparts, will continue to provide stable homes for their families.

The point is simple. Business needs to stay agile and in this digital age, that need is greater than ever. Workers' need for stability doesn't have to clash. Consider the success of Wonolo, a staffing platform for over 1 million workers, that just secured $140M in funding. Its attraction to workers is of course more money, but also flexibility. It is emerging as a job design learning mechanism where real people make choices across thousands of jobs, rather than the take-it-or-leave-it deal Anglo unions offer.

Maybe unions should set up their own Wonolo-type platforms. While they're at it, ask for employer investment in skill building for members, and just for kicks, demand the kind of representation labor has in German industry. Negotiating an extra $30 a week is nice, but it's not much to show for the cards workers are holding right now. Think bigger.

Critical Reading

Israel a step closer to commercial drones with latest tests

Commentary: The National Drone Initiative has scaled from 700 to 9,000 test flights, demonstrating the practicality and pitfalls of drone delivery in densely populated urban areas.
#deliver #drones

Procter & Gamble Uses Its Size to Lessen Impact of Supply-Chain Mess

Commentary: Provides perspective on how a range of companies are attempting to reverse years of scaling down, streamlining or centralizing operations.
#inflation #shortage #pricingpower

Britain Strikes Green Investment Partnership with Bill Gates

Commentary: £400 partnership defines next-gen climate mitigation technologies, including: green hydrogen, long-term energy storage, sustainable aviation fuels, and direct air capture of CO2.
#sustainability #COP26