So-Called “Right-to-Work” Laws and Janus Decision Have Eroded Job Quality of In-Demand Jobs
La Grange, IL: States that protect collective bargaining rights have higher average worker earnings, experience faster wage growth, and have added union members since 2013, according to a new study by the Illinois Economic Policy Institute (ILEPI) and the Project for Middle Class Renewal (PMCR) at the University of Illinois at Urbana-Champaign. Researchers conclude that U.S. Bureau of Labor Statistics data showing a declining unionization rate nationally actually offers an incomplete picture of the U.S. labor market, with the 23 states that protect collective bargaining gaining 100,000 union members over the last decade while the 27 states that with so-called “right-to-work” laws losing 336,000 members—fueling the overall national union decline.
So-called “right-to-work” laws allow workers to free ride, or to receive all the benefits and services provided by unions without paying membership dues or “fair share” fees. In doing so, the laws reduce the resources that unions would otherwise have available for collective bargaining or organizing new members. In its 2018 Janus v. AFSCME Council 31 decision, the U.S. Supreme Court overturned 41 years of legal precedent and imposed “right-to-work” conditions on public sector workers nationwide.
For their analysis, PMCR and ILEPI researchers used data from the Current Population Survey released by the Bureau of Labor Statistics at the U.S. Department of Labor to compare the 23 states and the District of Columbia that protect workers’ rights with the 27 states that have adopted so-called “right-to-work” laws. Industry-standard statistical techniques called regressions were deployed to parse out the effects of “right-to-work” laws on specific labor market outcomes.
Their analysis revealed that among all workers, “right-to-work” laws reduced the union membership rate by 2 percentage points and decreased average earnings by 4% over the last decade. The proliferation of “right-to-work” laws is having a disproportionately corrosive effect on the job quality of people of color and college-educated workers, as well as for in-demand construction workers and PreK-12 teachers.
“‘The data shows that ‘right-to-work’ laws have eroded job quality by weakening the institutions that help workers negotiate the terms and conditions of employment,” said study co-author and ILEPI Economist Frank Manzo IV, MPP. “However, it also shows that in states and sectors where collective bargaining rights have been protected, more working Americans are choosing to unionize.”
To better understand the direct impact of “right-to-work” conditions, researchers examined outcomes in five states that adopted “right-to-work” laws between 2012 and 2017—Indiana, Michigan, Wisconsin, West Virginia, and Kentucky—relative to those continued to protect workers’ rights. This assessment also found that “right-to-work” laws reduced unionization rates, decreased worker earnings, and had no substantial impact on labor force participation. In particular, the new laws were associated with a large 7% decrease in PreK-12 teacher earnings.
Study authors cautioned against concluding the U.S. Supreme Court’s Janus decision in 2018 was causing public sector workers to leave their unions. Instead, they noted that the decision’s imposition of conditions that produce lower wages may be contributing to an overall labor shortage in the public sector by making it more difficult to attract and retain qualified workers. For example, the number of unfilled positions at state governments, local governments, and public schools—the most heavily unionized segments of the American workforce—rose 78% from June 2018 to December 2022, which was 25 percentage points higher than in the private sector.
“There are different reasons from state-to-state for an elevated rate of vacant public sector jobs,” added study Co-Author, University of Illinois at Urbana Champaign Professor, and PMCR Director Dr. Robert Bruno. “But surveys show high dissatisfaction with wages as the leading culprit. When hundreds of thousands of jobs normally performed by union members are unfilled, it distorts the overall union membership picture nationally.”
With public opinion surveys showing approval of labor unions remaining at a six-decade high—including majority support from across the political spectrum—and workers dealing with rising costs and new safety considerations following the pandemic, a growing number of efforts to protect collective bargaining rights have emerged in the policy arena. This year, Michigan became the first state in 58 years to repeal a “right-to-work” law. Voters in Illinois voters approved the Workers’ Rights Amendment to the state’s constitution in November 2022, guaranteeing the fundamental right to unionize and bargain collectively. And in 2021, a bipartisan group of 213 members of Congress co-sponsored the Protecting the Right to Organize (PRO) Act.
“Instead of a national narrative that unions are in decline, the truth is that unions are popular and growing in the places that protect collective bargaining rights,” Bruno concluded. “Unions deliver better economic outcomes for workers and competitive labor market outcomes for in-demand careers. Conversely, so-called ‘right-to-work’ conditions weaken worker bargaining power and erode job quality, producing labor shortages in the places where our economy needs workers the most.”
The Illinois Economic Policy Institute (ILEPI) is a nonprofit organization which uses advanced statistics and the latest forecasting models to promote thoughtful economic growth for businesses and working families.
The Project for Middle Class Renewal (PMCR) at the University of Illinois investigates the working conditions of workers in today’s economy to elevate public discourse aimed at reducing poverty, create more stable forms of employment, and promote middle-class jobs.
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