The Right to Work
As Indiana lawmakers get ready to return to the Statehouse for Organization Day this Tuesday, the big 800 lb. gorilla in the room is “right to work” (RTW). Speculations and rumors have run amok over whether Republicans will take up the measure this session and whether Democrats will try to use every procedure in the rule book to stop it from seeing the light of day. (This is the point where I shamelessly plug a subscription to my political “Cheat Sheet” for the latest inside gossip and rumor regarding the Statehouse.)
One of the big criticisms of RTW has been that it has been labelled as “right to work for less”, with the argument being that wages in right to work states are less than those in states that don’t have RTW laws. That is one of those statements that is not entirely true. Allow me to explain.*
The average weekly wages in RTW states is about $776. In non-RTW states that amount is $908. This the part where the anti-RTW crowd yells and screams about how RTW is a race to the bottom. However when we make adjustments for Cost of Living (food, housing, utilities, health care, transportation and other goods and services), the weekly salary in RTW states is $822 a week and $821 in non-RTW states. Part of this is based on cost of living. On the surface, salaries in non-RTW states like California, New Jersey and Illinois are higher than Mississippi, South Carlina and Georgia, but those states also have much high costs of living. There is a big world of difference between living on $50,000 annually in Los Angeles versus living in Charleston, SC. The data also shows that the top 3 states for growth in personal income from 1999 – 2009 were RTW states: Wyoming, North Dakota and Louisiana. Michigan, a non-RTW state was at the bottom of the list.
I have never believed anyone should be forced to join a union as a condition of their employment. If a union is providing a quality service, then members should voluntarily sign up for it. That aside, that was not the motivation for my writing this blog post. My motivation was the argument that RTW drives down wages and costs of living. I don’t know if you’ve been to Texas or Florida, but those places aren’t cheap to live and they are also RTW states. The point of RTW is not to return to the days of sweat shops, it is to create jobs and economic development. If lawmakers fail to pass RTW that’s one thing, but at the very least, we should have the vote and be done with this issue once and for all. However, in a world of 9% unemployment, we should be doing everything possible to create jobs.
* The basis for my research are: “Rich States, Poor States”, ALEC, 4th Edition, http://www.missourieconomy.org/indicators/cost_of_living/index.stm
Average Weekly Wages – http://www.bls.gov/sae/home.htm
