The Implications of Global Competitiveness on U.S. Unionization - Essay Example

The Implications of Global Competitiveness on U.S.Unionization Table of Contents Table of Contents 1 Introduction: Labor union 2 History of the US labor unions 3 Formation of Labor unions 3 Labor relations 4 National Labor relations Act (NLRA) 5 Impact of Globalization on Labor unions 5 Conclusion 8 References 9 Introduction: Labor union Labor unions are organized groups formed by a group of workers for a common cause or movement. According to some theorists, they are either “interest groups” or “social movement groups” (Asher, 2001, p. 03). They work in the manufacturing department of the organizations and their primary task is to fix wages by revolting or protesting and make employers hear their demands. They try to exercise monopoly power within the organization (Fossum, 2009, p. 01). In the United States of America (USA), they are known as “labor unions” and in other countries they are called “trade unions”. The impact of the labor unions is very negative in a workplace as: 1. It hampers the productivity of the employees and causes project delays. 2. It creates a negative work atmosphere and conflicts among employer/employees. 3. The employer and employee relationship is damaged by late payments in salaries, project delay etc. 4. They have indulged in political activities to protect the organizational interest against government’s action. The leader leads the group usually for unauthorized actions like strikes, protests etc. History of the US labor unions In the late nineteenth century, unions were formed by craftsman or artisans; they had a high degree of autonomy in their political and economic activity (Asher, 2001, p. 06). The first union was formed by the name “Federation of Organized Trade and Labor Unions” in the year 1881. This later transformed into “American Federation of Labor” in 1886. The main objective was to maximize the members of the group and consider the well being of the members of the group (Asher, 2001, p. 10). In the past, labor unions were regarded as interest groups that evolved out of social movement. Gradually, the success of the movement transformed into their institutionalized group. Formation of Labor unions The labor unions are formed unintentionally in the USA; they have become precursor in the US organizations. They are formed out of mutual interest or perceived danger. The latter is always a reason of cohesiveness among workers in an organization (Fossum, 2009, p. 10).The relation between threat and cohesiveness is hypothetical but linked. Let us take an example from John Fossum’s theory of “Relationship between threat and Cohesiveness”. Figure 1 (Source : Fossum, 2009, p. 11) According to John A. Fossum ,The cohesiveness of a group are of two types : 1. Group Cohesiveness –The group is formed due to similar interest. They tend to behave similarly, as they have similar thought process, beliefs, norms etc. 2. Class Cohesiveness: The classes of employers and employees are different. The relationship is also very different. As, the class consciousness increased, so did the unionization (Fossum, 2009, p. 07). Labor relations It is a set of activities and process performed by the employer and employees to resolve differences. The process includes 1) Collective bargaining 2) Participation empowerment The practice of labor relation process is governed by the laws incorporated by the organization. The laws incorporated by the organization are universally applicable, as they are common set of laws used by all organizations (Fossum, 2009, p. 01). National Labor relations Act (NLRA) The act was enacted in 1935. This act gave authority to the private sector employees to engage in an organized union activity. It also gave workers the right to select their own representatives and to bargain with their own employees. The employers had no right to intervene in their decision making. Farm workers were debarred from the rights (Stacy, 2002, p. 25). Impact of Globalization on Labor unions There was a severe decline in labor unions during the years 1977 to 1987. This was due to increased competiveness from local and international competitors. In this period the number of US workers in the manufacturing industry declined by 2.6 million, whereas there was a decline of 1.2 million workers from the period 1987 to 1997. The number of manufacturing jobs increased by 1.8 million in the United States of America (USA) during 1977-1997 (Baldwin, 2003, p. 01). The main cause of this decline was due to the following reasons: 1. Increased competition from local and global competitors. 2. Deregulation of transportation industries. 3. Declining efforts of union team leaders to recruit new members. 4. Government activity that can substitute for union services. For example: unemployment insurance and industrial accident insurance. 5. Increased resistance from management towards unionization efforts (Baldwin, 2003, p. 02). The major cause of decline of labor unions is due to the increased resistance from management. The employers considered that the main motive of the unionization was to increase their wages (Baldwin, 2003, p. 02). This hampered the productivity of the organizations. Frequent strikes and protests led to a negative environment in the workplace and caused project hiatus. Another major factor that led to decline in labor unions was advanced technology; newly invented machines displaced labor in most of the factories (Baldwin, 2003, p. 03). Competition increased rapidly in various service sector industries leading to increased responsibilities of workers (United States Office of Technology Assessment, 1993, p. 03). This increased the work pressure of the workers and expanded into a conflict with the managers of the organization. Machines replaced labors in most of the industries, which could yield twice the results than the labors. Unionization levels in the USA have declined drastically over the past few years. Currently unions represent only a 12.7 percent of private sector workers. The downsizing of the labor unions wouldn’t have been possible if the labor unions had engaged in a positive initiative to resolve conflicts with the management. (United States Office of Technology Assessment, 1993, p. 03). In other nations, workers are not represented only by unions but also have developed work councils. The work councils engage in positive interaction with the managers of the organization and deal with non-wage issues like training, technological issues etc., and believe in productivity improvement of the organization. Table 1 ( Source : Baldwin, 2003, p. 01) This table focuses on the steep decline of unionization in the USA and other nations.The unionization decline was often viewed as shift of employment from one sector to another sector. In the USA, regions like Pennsylvania, Delaware, Maryland,Virginia and West Virginia witnessed a major decline labor unions during the 1977-1987 period. These areas constituted metal industries, printing and publishing, wood and timber industries (Baldwin, 2003, p. 22). The labor unions had peaked during the mid 1990s, There were twenty million members in the labor union (Asher, 2001, p. 13). According to some theorists, the changing nature of economy and employers resistance toward labor unions were the major cause of downfall of the unionization (Asher, 2001, p. 16). The main reason may be that workers found it difficult to adapt to changing rules and regulations of the organizations. Conclusion Global competiveness may have had positive impact on the industries by reducing their work effort and increasing their productivity but had a negative impact on the labor unions. Powers of the labor unions may have weakened gradually over the years but the shift in employment rate over the unemployment rate suggests that there was a major shift of workers from the manufacturing sectors to other service sectors. References Asher, H. B. (2001). American labor unions in the electoral arena.Maryland: Rowman & Littlefield. Baldwin, R. E. (2003). The decline of us labor unions and the role of trade globalization balance sheet series. London: Peterson Institute. Fossum, J. (2009). Labor relations. Irwin: Tata McGraw-Hill. Stacy, L. (2002). Mexico and the united states. Singapore: Marshall Cavendish. United States Office of Technology Assessment, Congress. (1993). Pulling together for productivity a union-management initiative at us west. Darby: DIANE Publishing. Read More