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Canada should not adopt U.S.-style anti-union laws


President Barack Obama had it right Monday when he told the people of Michigan that so-called right-to-work legislation is about politics, not jobs.

Such legislation, now in place in 23 U.S. states, undermines union finances by giving members the right to withhold dues, even though they continue to enjoy the rights and benefits of a union contract.

These laws are pretty effective in undermining unions. The unionization rate in right-to-work, or RTW, states averages just 7.6 per cent, compared to 18.6 per cent in the non-RTW states.

But independent research shows that jobs, even in manufacturing, do not flow to states that pass anti-union laws.

A methodologically sophisticated study by Michael Hicks, Director of the Center for Business and Economic Research at Ball State University finds no significant link between RTW laws and manufacturing employment trends.

And a study by Gordon Lafer and Sylvia Allegretto for the Economic Policy Institute finds that manufacturing employment in Oklahoma fell precipitously - by about one-third - in the decade after that state adopted a right to work law in 2001.

Ontario Conservative leader Tim Hudak supports RTW legislation, and argues it would help Ontario retain and attract manufacturing jobs.

But Canadian experience also suggests little reason to think that weaker unions mean more jobs.

The unionization rate in manufacturing in Quebec in 2010 was 37.4 per cent, almost double the 19.8 per cent in Ontario. Moreover, the manufacturing unionization rate in Quebec is almost unchanged from 2000 (when it stood at 41.7 per cent) while the rate has fallen sharply, from 31.1 per cent, in Ontario since 2000.

Nonetheless, between 2000 and 2010, Ontario lost 301,000 or 28.9 per cent of the province’s manufacturing jobs, while Quebec lost 120,000 or 19.9 per cent of its manufacturing jobs.

Unionization is only one modest factor in the decision of manufacturing firms to invest or to cut jobs. True, unions do generally bargain better wages and benefits, but unionized workplaces also have lower worker turnover and higher productivity.

The last decade has been brutal for manufacturing workers. Canada has lost more than 500,000 jobs and real wages have barely increased.

But there is no reason to think we would do any better by embracing extreme U.S. anti-labour laws.

This article originally appeared in the Globe & Mail's Economy Lab.