Beth Shulman
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Beth Shulman is a vice president,
director,
and executive board member of the
United Food
and Commercial Workers International
Union.
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There is great hand-wringing in the United States about
stagnant living standards and rising inequality. But despite
this growing concern, too many liberals are reluctant to
embrace
the best proven agent of greater earnings equality-strong
labor
unions. Many well-meaning liberals point to global
competition as
the cause of widening gaps between semiskilled and knowledge
workers, creating income disparity and stagnant living
standards. According to their formula, education and
retraining are the remedy for this increasing inequality.
Yet this solution allows American business to rationalize
low
wages and widening inequality as merely a necessary response
to global competition. The education solution avoids the
profoundly political question of how profits from
productivity gains should be shared with workers. Here
again, unions are a necessary agent of change.
The globalization argument also has the effect of paralyzing
workers who are continually bombarded with the message that
they are powerless against lower, worldwide labor costs. If
they push for higher wages, they lose their jobs. If they do
not, they continue to
watch their wages stagnate.
This global economy, however, is not the primary culprit of
stagnant living standards and rising inequality. It is true
that the continued opening of our borders has eliminated
jobs and depressed wages of American workers in industries
in which the products compete globally, such as textiles,
shoes, data input, cars, and steel. Even high-skilled
workers, such as computer design engineers, have lost their
jobs as new communication technologies bridge the
continents. But even in industries competing globally, the
global competition rationale for reducing American workers'
wages does not stand up to close scrutiny. In many
industries, Business Week recently reported, Third World per-
unit labor costs are close to American levels because of low
Third World productivity.
Yet as devastating as globalization has been in some
sectors, these jobs account for only a minority of today's
workers. Most jobs today do not compete globally. As seen in
recent figures compiled by the Bureau of Labor Statistics,
one could conservatively estimate that three-fourths of the
private-sector jobs in the United States are not subject to
global competition.
[See table on next page.]
Putting the entire goods manufacturing sector into the
global marketplace and adding
all of the finance sector still leaves
Mining
Construction
Manufacturing
Utilities
Wholesale Trade
Retail Trade
Finance, Insurance, & Real Estate
Services
.42 3.99 12.78 5.18 5.09 18.23 5.04 28.54
Total
79.27
77.5 percent of the
jobs in the U.S. out
of the reach of global Transportation & Public
competition. Not only
is this non-global
sector of the economy
the largest, it is the
fastest growing. From
1972 to 1993, service
jobs more than doubled
in number while
manufacturing jobs
dropped 10 percent.
This growth is projected to continue. Most new jobs today
are in the lower-wage service sector-checking out groceries,
waiting on tables, servicing office equipment, caring for
the sick, and cleaning up for the rest of us. Wal-Mart is
the largest creator of jobs in the United States-not Intel,
not Boeing, not Microsoft. Between 1987 and 1995, Wal-Mart
created a staggering 481,000 jobs; today, it has 622,000
full- and part-time employees.
Ignoring this reality, many liberals have embraced
reskilling workers as the sufficient solution to the
declining living standards of American workers. The
reskilling argument contends that for workers to compete in
the global market and increase their incomes, they must be
retrained for "high-tech, high-skill" jobs. But there is
growing evidence that with the exception of advanced
degrees, education does not have the return on investment it
historically had. We obviously need improvement in education
and skills to prepare workers for jobs in higher-skilled
areas. However, the real education gap is at the lowest end
of the labor market, requiring the basic skills of reading,
writing, and
arithmetic. The declining standard of living for a majority
of workers in the United States will not improve by sending
workers back for more training. An active and powerful labor
movement is the mechanism that can bring workers livable
wages, as it did for an earlier generation of workers.
Copyright 1996 by The American Prospect, Inc. Preferred
Citation: Beth
Shulman, "Yes, Union," The American Prospect no. 29
(November-December
1996): 77-81 (http://epn.org/prospect/29/29shul.html)