Is History Repeating Itself?

For the last few weeks, we’ve been blogging on the Federal Reserve’s initiative, Investing in America’s Workforce.  The initiative identifies the issues employers and employees are facing under the current economic conditions based on conversations each of the Fed regional branches has had with people in their areas.  The responsibility of the Fed is to make sure the United States has a strong economic system so for the Fed to address workplace issues when they normally don’t is sending a very strong message that it’s time to do things differently.  As the policy analyst from the Boston Fed pointed out, if something isn’t done to address these employer-employee issues, it will impact the entire U.S. economy.

On the website, Investing in America’s Workforce, there is a report with a summary of what was learned from each of the Fed’s regions.  What was really surprising wasn’t that each region had their own set of problems but each region was identical to the problems they were facing in regard to employers and employees.  Employers were having problems finding workers and workers, especially unskilled workers were having difficulty in finding that quality job we identified in one of the recent blogs.

There were many recommendations in the report including workers should be viewed as an investment instead of a cost and workforce needs and economic development needs need to be more closely aligned.  Yet the report neglected to identify what personnel from MIT’s Sloan School for Management and others saw as a significant issue, particularly for unskilled workers, and that was the inability of unions to have influence on worker issues.  They said both automation and globalization have certainly played a role in the decreased size of unions, and because unions don’t have the power they once did, it has caused stagnant wages and benefits and a loss of voice in the workplace.

Another very good and recent example of union struggles is at the Volkswagen plant in Chattanooga, Tennessee.  United Auto Workers has tried multiple times to organize the plant.  Outside interest groups, politicians and others launched massive attacks against the union which didn’t help the outcome of the vote for the union.  The next time UAW tried to organize was with a smaller group of the skilled trades people.  That group voted for the union but management refused to recognize the it unless the entire plant voted for the union.  That may happen as another attempt is going to be made.  Just this last week, UAW filed a petition with the National Labor Relations Board to vote again for plant organization.

The sad part about the Volkswagen plant is the very people who are supposed to be representing ordinary Americans were the ones fighting against better wages for people and creating a workplace voice for them.  Volkswagen managers who were familiar with work councils were willing to establish one at their plant so both labor and management could work together to tackle the issues they faced.  They, like the companies on the Kansas City Fed website, knew the importance of  investing in workers.

Any  company, union or non-union,  knows providing worker voice helps them be successful.  As the policy analyst from the Boston Fed said when workplaces invest in workers they will see greater productivity, decreased turnover and an overall greater return for their profits.  The owner of one of the companies we have worked with says the same thing.  He’s been able to expand his business and also provides benefits back to the employees through such things as greater financial incentives and increased benefits.

Before we end, let’s reflect on life in America and how it relates to the Fed’s initiative.  More jobs are available with the increase of technology.  Skilled and unskilled workers alike are able to get a job.  Cities are constantly moving and evolving which helps to expand that job creation. It’s a land of equal opportunity as people come to seek refuge from political or religious persecution and escape poverty.  Other countries love to invest in the United States because the economy is strong and robust.  There are new media outlets that are very popular with people and that’s created its own competition.  While all of this sounds like life is wonderful,  there are some major underlying issues.  Those jobs that are employing so many people are those that don’t  pay very much or people have to work long hours and many days to pay bills and feed families.  Work environments have become less safe.  Workplace accidents are occurring more often.  Breaks are almost non-existent in some workplaces.  Business owners are unwilling to raise wages and fight off unions.  Wealthy individuals appear to be increasing their wealth and political unrest is taking place because of those who have and those who have not.

That description of life in America sounds a lot like America today doesn’t it? It’s not.  That was life in America before the 20th century during the so called Gilded Age and by 1895, there was a severe panic in the financial markets.  The financial system of the United States was about to collapse.  Luckily one person was able to come in to prop it up for a few years before another one occurred.

The question is, do we want that to happen again?  We saw what happened during the Great Recession in 2008.  Is history repeating itself?  Unlike 1895, we now have the Federal Reserve to watch over the economy and the Fed is saying it’s time to change.  Are we willing to change our ways and work together to avoid a repeat of history?

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About CALMC Blog

Columbus Area Labor-Management Committee is a not-for-profit organization dedicated to involving employers and employees to preserve jobs, resolve workplace issues, and promote labor-management cooperation. Visit our website at http://calmc.org
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