As all of us competing in the marketplace know, the last five to six years have been about preservation and survival. And while there are signs of improvement and recovery in some sectors, no one really thinks this economy is a sure bet yet.
While the economy is down, it’s easy to just focus on survival – and ignore other issues that might be just around the corner. Maintaining a union-free status is one such issue that can get lost in the shuffle. But, as things improve, the economic consequences of ignoring this issue can be severe.
Yesterday, the Bureau of Labor Statistics (BLS) issued its March 2013 Employer Costs for Employee Compensation News Release. BLS’s report demonstrates the economic impact that losing union-free status can have as a business’s bottom line. In March 2013, the total average compensation cost per hour to employers for union workers was $40.43 compared to $28.02 for non-union workers. Additionally, as analysis from the Bureau of National Affairs (sub. req.) shows, the gap between union and non-union workers is growing. From the first quarter of 2012 to the first quarter of 2013, union average compensation costs rose 5.3 percent while non-union average compensation costs rose only 0.8 percent. That kind of disparity can be significant to any bottom line. And don’t think that unions are not prepared to exploit these kinds of numbers as the economy improves. Not only that, but as things improve, workers often start thinking they too need to benefit.
Businesses that have been forced to change to survive and then start experiencing growth also face issues that can make union organizing more of a risk. These include lack of focus on effective day-to-day management in a rapidly changing or growing environment or being so focused on customer demands that important day-to-day labor relations principles are shoved to the side. And for businesses that are now in a hiring mode, there always is the risk of hiring union “salts” or sympathizers.
Times of growth and change are times when union-free employers are particularly vulnerable. Bottom line: Assessing your risk now is critical. As demonstrated by BLS’s latest statistics, to do otherwise could just jeopardize any new found success you’ve worked so hard to create.