By the Economic Policy Institute
On Tuesday, Missouri voters will go to the polls to decide whether to adopt the so-called “right-to-work” (RTW) statute approved by the state legislature last fall.
Despite its name, RTW does not confer any right to employment. Nor does it make it so that workers can’t be required to join a union as a condition of employment, which the law already prohibits. Instead, RTW says that unions cannot charge nonmembers their fair share for the services unions are legally required to provide to everyone.
By letting people get the benefits of union representation at no cost, RTW eats into union resources and undercuts their ability to negotiate better wages, benefits, and working conditions. This doesn’t just hurt union members. Unions raise wages for working people across the board, by setting a standard that nonunion employers must meet to attract qualified workers—and to ward off unionization efforts in their own shops.
Across the country, large sums of money have been spent backing RTW bills, with corporate lobbyists claiming that RTW will create jobs and boosts wages by attracting companies to the state. Almost all of Missouri’s neighbors have gone RTW and the results are clear. There has been no increase in business investment or employment, but unions are weaker and wages are lower—exactly what RTW proponents hope to achieve.
Take Oklahoma, which went RTW in 2001. Corporate lobbyists told Oklahoma lawmakers and the public at large that if they passed a RTW law, there would be an eight- to tenfold increase in the number of new companies coming into the state—especially in manufacturing. That is the type of claim that is being made in Missouri today.
But more than 15 years later, none of these promises have come to pass in Oklahoma. Oklahoma has been losing manufacturing jobs since 2001 at the same pace as the country as whole. Overall job growth in Oklahoma has been tied to the boom and bust of the state’s energy sector, with job losses in recent years that have put the state’s total growth since 2001 below the U.S. average.
How does Missouri’s unemployment rate compare with its RTW neighbors? Missouri’s unemployment rate reached a higher peak during the Great Recession than its RTW neighbors, 9.5 percent in 2010 compared with 7.7 percent. However, Missouri experienced a stronger recovery and by 2017, Missouri had the same level of unemployment as its neighbors—3.8 percent. Without a RTW law, Missouri was able to bring its unemployment rate down 5.7 percentage points since unemployment peaked in 2010.
In other words, there’s no evidence that RTW laws boost business investment or employment. But there is plenty of evidence that RTW laws hurt unions and lower wages. Nationally, 5.2 percent of private-sector workers in RTW states are union members or are covered by a union contract, compared with 10.2 percent in non-RTW states. Based on the experience of Oklahoma, it stands to reason that 60,000 fewer Missourians will be covered by a union contract if the state goes RTW.
When unions have fewer resources, they can’t bargain for higher wages, and workers suffer. Nationally, workers in RTW states have 3 percent lower wages than their non-RTW counterparts—even after controlling for things like cost of living, education, and demographics. Male workers in Missouri’s RTW neighbors make 8.4 percent less than their Missouri peers; female workers make 3.5 percent less. Workers of color—who are more likely to be covered by a union contract in Missouri—will be especially hard hit. Black workers in Missouri’s RTW neighbors make 4.4 percent less than they do in Missouri, and Hispanic workers earn 7.4 percent less.
When working people make less money, it hurts the local economy, and lowers tax revenues for state and local government — forcing communities to get by with less. Instead of looking for ways to undercut working people, Missouri should focus on policies that improve jobs and boost middle-class incomes — such as raising the minimum wage, strengthening overtime laws, and providing access to affordable child care, paid leave, and fair scheduling.
The state should also invest in education and workforce readiness, to ensure that today’s children will be ready for the future and that current workers can transition into new occupations if they need to. Making investments in infrastructure, transportation, broadband access, and water and electric utilities will help Missouri create good jobs that feed local economies. Lastly, Missouri could reform its tax code so everyone pays their fair share.
By making investments in jobs and communities—not undercutting unions and working people—Missouri can create an economy that’s growing and, importantly, working for all Missourians.