Would a right-to-work law bring more jobs to West Virginia?
Would a right-to-work law lower wages in West Virginia?
There is evidence to support both points, and business and labor leaders made familiar arguments during a public hearing on right-to-work in the West Virginia House of Delegates chamber Thursday.
A right-to-work bill (SB 1) passed the state Senate last week, on a strict party-line vote, and a vote in the House of Delegates could come as soon as next week.
Of the approximately 25 speakers at the hearing, the only surprise came from Lane Ferguson, president of Nitro Construction Services, who said his business has worked all over the country, including in many right-to-work states.
About 10 years ago, the company did the HVAC work on a Toyota plant in Texas. He said he was able to pay workers there lower wages, but found that they could not do the job.
“What we find is a reduced rate of pay, which doesn't attract the best and brightest people to the craft,” Ferguson said. “What you have is people earning a lower wage but don't know what they're doing.”
Ferguson said that he's often had to import West Virginia workers to out-of-state jobs where he couldn't find skilled labor.
“Our experience in those states is not what's being represented here,” Ferguson said. “This is being pushed by people who do not know firsthand what's going to happen. When you pass these bills, wages are going to go down.”
Parween Mascari, of the state Chamber of Commerce, cited West Virginia's dismal workforce participation rate — which has long been the worst in the nation.
“We need to give our economic development folks the tools that they need to go out and get the things that this state needs the most, and that is jobs,” Mascari said.
The state Department of Commerce repeatedly has said that right-to-work is not an issue for it, when it comes to recruiting businesses. But Mascari said that, in conversations with county economic development officials, right-to-work often is mentioned as a reason why businesses don't relocate to West Virginia.
Mascari drew noisy guffaws from the largely pro-union audience when she said, “this is not in any way an anti-union bill.”
While there are dozens of studies on the effects of right-to-work laws — some saying they improve growth, some saying they lower wages, some saying both — almost all agree that they are bad for unions, lowering membership and finances.
Several speakers, arguing in favor of right-to-work, cited Michigan and Indiana, which both passed the laws in 2012. Those states have seen growth in manufacturing jobs, as well as growth in union membership, but that also coincided with the massive federal bailout of the auto industry, which dominates both states' economies.
Right-to-work laws, which are in effect in 25 states, allow employees at unionized workplaces to opt out of paying union fees, even though unions are obligated to represent every employee at the workplace.
Proponents of the laws (mostly Republicans) say they're about fairness and attracting businesses; opponents (mostly Democrats) say they are designed to cripple unions and will lower wages.
Can both things be true? Can right-to-work laws attract businesses and jobs but also bring in lower-paying jobs and, by weakening unions, lower wages at existing jobs?
Opponents of right-to-work tell a simple story — if it does draw new business, which they don't necessarily concede, the businesses are drawn by the ability to pay lower wages.
The federal Bureau of Labor Statistics announced Thursday that union workers earned an average of $980 a week in 2015, compared to $776 for non-union members.
Kenny Perdue, president of the state AFL-CIO, called right-to-work a “race to the bottom,” a continual battle among the states to make themselves more and more business-friendly, resulting in spiraling wages.
Ted Boettner, director of the progressive West Virginia Center on Budget and Policy, said the laws are about reducing the income and power of working families.
“If it didn't lower wages, there would be no incentive for businesses to come to this state,” Boettner said. “West Virginia is already a low-wage state, with wages below the national average. Adopting right to work would mean wages even lower.”
Sterling Ball, a representative with the United Food and Commercial Workers, said its members in Virginia, a right-to-work state, make an average of $2 less per hour than they do in West Virginia, for the same job.
He quoted Dr. Martin Luther King Jr., who spoke about right-to-work in 1961: “Its purpose is to destroy labor unions and the freedom of collective bargaining,” he said. “Wherever these laws have been passed, wages are lower, job opportunities are fewer and there are no civil rights.”
Supporters of right-to-work say it does not prevent anybody from joining a union, it just gives workers the option to not pay union dues. They say it would not mean lower wages.
“It just adds to the core of the issues that make it a little more attractive to either expand a business or locate a business within the state,” said Chris Hamilton, president of the West Virginia Business and Industry Council, in explaining why businesses are attracted to right-to-work states.
Hamilton said that as many as 50 percent of businesses won't consider expanding in a non-right-to-work state. Pressed on what, specifically, is attractive to businesses about right-to-work, though, Hamilton hedged.
“I can't speak for those businesses. You're asking me to speak for independent businesses and why they either come to West Virginia or don't,” Hamilton said. “I don't have the answer for that.”
Steve Roberts, president of the state Chamber of Commerce, said that, over the long term, right-to-work states have seen better growth.
He said a right-to-work law is less about concrete changes in a state's economic conditions than it is about symbolism — showing businesses that tax, regulatory and labor laws are friendly toward them.
“Right-to-work tends to be emblematic of a state that wants to attract businesses, versus a state that is content with where it happens to sit,” Roberts said. “The starting point is that it is a symbol. I think the next sort of level is that employers like the idea of worker freedom.”
Terry Bowman founded a pro-right-to-work group in Michigan, and has twice come to West Virginia to testify before the Legislature about the subject. He said businesses are attracted to right-to-work states not because they can pay lower wages but out of sympathy for their workers.
“If my business gets unionized, are those workers going to be forced to [pay dues] as a condition of employment,” Bowman said. “So, I think it's a quality-of-life thing; they may want their workers to have the freedom to choose.”