Labor: Strike While the Iron Is Hot

Auto dealerships are known for attention-grabbing displays, from inflatable characters to vehicles perched on high platforms. Over the summer, I passed a local dealership that featured a sight I hadn’t seen for years: A picket line of mechanics on strike. As the year continued, strikes and other labor actions have become more commonplace, spanning sectors including healthcare, food production, manufacturing, and entertainment. Have workers entered a new era of greater power?

Weekly Economic Commentary - Chart 3

Large-scale strikes have become a rarity in recent decades, because private sector union membership is a shadow of the levels seen in past generations. The union share of the U.S. labor force peaked at 25.5% in 1953, and has been falling ever since. Right-to-work laws and skepticism surrounding the value of dues reduced the power of many unions, while fair labor standards and occupational safety laws have ensured some of the workplace protections that unions advocated in the past.

But a union card is not required to be emboldened. Non-union workers lack the organization that would allow for strikes, but they are seeking new opportunities on their own terms. The wide availability of jobs and high demand for employees has given workers more confidence that they can leave their current posts and find another job at higher pay. This has forced employers to up their own pay scales to sustain staffing.