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Labor Unions

Labor Unions. Labor Quiz. What is your name? What job would you like to have in 10 years? Is the U.S. capital intensive or labor intensive? Does the U.S. have more service/manufacturing jobs or agricultural jobs? Would you be willing to move to find a job that pays better? Why or why not?

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Labor Unions

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  1. Labor Unions

  2. Labor Quiz • What is your name? • What job would you like to have in 10 years? • Is the U.S. capital intensive or labor intensive? • Does the U.S. have more service/manufacturing jobs or agricultural jobs? • Would you be willing to move to find a job that pays better? Why or why not? • Name one major change in the labor force over the last 100 years. • Who make more money on average; high school grads or college grads? • What is affirmative action designed to correct • What are two factors that help you determine which job you want to apply for? • How old do you have to be to be considered part of the “labor force”?

  3. Income v. Wealth • What do you think is the difference between income and wealth? • Income—flow of “money” • Wealth—accumulation of “money” • Many of us would be in dire straights if we lost 1 or 2 paychecks • Which do you prefer?

  4. Factors that affect wage distribution Education --a high school grad averages $31,000 a year over a lifetime compared to $60,000 a year for a master’s degree Gender --women still earn only 69% of what men do --”glass ceiling” --Why does this still exist? Race/National Origin --African American males earn 75% of white males --Hispanic males earn 70% of white males --Affirmative Action designed to repair this

  5. Factors that affect wage distribution • Age • Easier to mold, cheaper to hire, use benefits less • Geography • Indiana v. California • Yuba City v. San Francisco • Deep South is poorest, NE is wealthiest • Luck • Lottery, gambling, right place/right time • Inheritance • Dangerous Jobs • Police, firefighters, underwater welders, lumberjacks

  6. How Wages are determined! • Market Forces • Supply & demand • Skilled v. unskilled • Dangerous v. menial jobs • Non-Market Forces • Labor unions • Can increase wages through negotiations • Government legislation: minimum wage laws, under 18 laws, civil rights

  7. Redistribution of Income • Transfer Payments—money without work • Welfare, unemployment, social security, food stamps, WIC, disability • Taxes • U.S. has a graduated income tax system…meaning the more you make, the higher percentage of your income you pay in taxes • Highest federal tax brackets are 29%, lowest is 0% • These taxes pay for the transfer payments • Better education and training

  8. Poverty in America • U.S. Census Bureau determines the poverty level and adjusts it annually • For 2008, Poverty level is $22,025 for a family of 4 • For 1 person, $10,991 • Higher Incidence of Poverty • Minority families • Family households headed by women • Family household headed by young or elderly

  9. Changing Relationships Between Labor & Management • Local markets became more regional, increasing production • Railroads…broadened markets w/ easier transportation • Industrial Revolution • Worsened working conditions, larger production scale, shift to machinery • Competition forces management to lay-off workers for efficiency • Early Unions

  10. Early Unions • Knights of Labor • Skilled/unskilled workers • Dissolved due to inept leaders • American Federation of Labor (AFL) • Samuel Gompers established a craft union in 1881 • Didn’t allow women, minorities, or unskilled workers • Committee for Industrial Organization (CIO) • Established in 1935 for unskilled workers to oppose AFL • Merged with AFL in 1955 for form AFL-CIO, largest union in country

  11. Basic Aims of Unions • Higher Wages • Profits, equal pay, productivity, COLA (cost of living adjustment) • Less hours/ overtime pay • Union Labels on American made products • Job security based on senority • Fringe benefits • Health care, vacation, paid days off, retirement, day care • Grievance Procedures • A way to formally complain about management with fear of termination • Safety

  12. Collective Bargaining Process:How unions negotiate with management • Wagner Act (1935) gave 1 union the right to negotiate for a set of members • Most of the time collective bargaining agreements have a no strike clause • Most contracts last 2-3 years • Process: (Bargaining) • Union & management negotiate wages, benefits, & grievances • If they can agree, a third party gets involved • Mediation—listens to both sides; offers compromise; not legally binding • Arbitration—same as mediation, but decisions are binding in grievance procedures • If mediation/arbitration fail, a strike could occur, but is very rare • Strikes can be boycotts, picketing, sit-ins

  13. Current Labor Union Problems • Decline in membership • Only 10% of workers are union members • Rise in white-collar, non-union jobs • Decline in blue-collar jobs, higher wages sent jobs overseas • Unpopular Strikes…especially in sports • Public employees and the right to strike upsets public • Economic recession & “give backs”

  14. Questions • Do you see unions as outdated? • Would you like for your career to have a union? Why? • What are some factors that affect wage distribution? Which ones can you control? • How do supply & demand help determine your wage? • What is the difference between AFL and the CIO? • What happens if mediation or arbitration fail in the collective bargaining process?

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