Understanding the Union Vote at VW in Tennessee

As you probably know, the United Auto Workers (UAW) lost a union election at a Chattanooga Volkswagen plant last month by a vote of 712 to 646 (53% to 47%). My heart goes out to the workers and UAW leaders who put heart and soul into achieving a different result.

I was taken aback by the vote, I have to admit. So it has taken me a couple of weeks to process it.

The most obvious explanations for the election outcome start with the political and cultural hostility to unions in Tennessee. VW may have stayed neutral on the election, but the right-wing anti-union political establishment in (and beyond) Tennessee did not. The political interference in the election is the basis of a UAW appeal for a revote.

Beyond these much-discussed variables, a deeper issue raised by the UAW election is what model of unionism could fit the U.S. auto industry and U.S. manufacturing going forward? My contention will be that the UAW was groping towards a new model that would benefit employers and the community as well as workers — and to encourage it to keep going.

The union model with which the UAW has traditionally been associated is "industrial unionism." Industrial unions seek to represent all workers in the industry and take wages and benefits out of competition. U.S. industrial unions also provide shop-floor protections through work rules and a grievance procedure. As a result of U.S. employer opposition and American labor law, however, U.S. industrial unions have always been fragmented. Bargaining took place one company or one plant at a time and then spread to other companies through so-called pattern bargaining. (In other countries, the law supports genuine industrywide bargaining to set wages and benefits in master agreements that apply to all employers.)

In the U.S. auto industry, the pattern contract was always at one of the "Big Three" automakers — GM, Ford, or Chrysler. Once terms were established at the lead company selected each bargaining round, the union would seek to achieve the same terms at the other two of the Big Three and at auto suppliers.

Since the union had to organize and bargain one company (and sometimes one plant) at a time, maintaining industrywide union presence and wage and benefit standards was an exhausting and challenging process for the UAW from the beginning. As early as the late 1950s, individual suppliers sought below-pattern wages and benefits and later to avoid the union in new (more rural and/or southern) plants. Rising vehicle imports and globalization of the supply chain to low-wage Mexico and Asia further dented the union's ability to take wages and benefits out of competition.

In the last two decades, the union has been forced to retreat into the "Big Three" automakers (GM, Ford, and Chrysler), with most suppliers non-union. Even within the domestic assemblers, the growth of non-union foreign transplants (VW, Toyota, Honda, Nissan, etc.) has created a non-union presence. That is why the UAW hoped to win an election at VW and then build on that success at other transplants.

But unlike the 1930s to 1970s, victory at one plant doesn't plausibly maintain the union's industrywide presence. Nor does it fit with the simple New Deal narrative in which union wage increases for all manufacturing workers drove the overall economy. (Unions now represent 11% of private-sector manufacturing workers, or about 15% to 16% of production and non-supervisory workers.)

These broader trends create challenges for the UAW as it seeks to persuade workers that joining the union serves their interest. Since it's not clear that workers at competitors will also rise, the broader trends leave workers more susceptible to arguments that a union at their plant could threaten future investment and job security. These broader trends require the union to make a new argument about how it fits into the auto industry and why this new union model will not only raise wages and benefits but also enhance job security.

In fact, the UAW did begin to make this type of argument, centering on the fact that unionization would permit VW to establish "works councils" and a cooperative workplace relationship that helps ensure competitiveness.

In another blog post, I will develop the idea that U.S. manufacturing is in trouble unless unions grow that encourage U.S. employers to invest more in workers and pursue "good jobs strategies."

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