SIC 8631 Labor Unions and Similar Labor Organizations

Encyclopedia of American Industries | 2005 | Copyright

SIC 8631
LABOR UNIONS AND SIMILAR LABOR ORGANIZATIONS

This industry includes membership organizations of workers that operate for the improvement of wages and working conditions.

NAICS Code(s)

813930 (Labor Unions and Similar Labor Organizations)

Industry Snapshot

After experiencing a slight resurgence in the late 1990s, labor unions continued to see their membership ranks diminish in the early 2000s. According to the U.S. Department of Labor, overall union membership has declined over the past two decades. The number of wage and salary workers belonging to unions fell approximately 7 percent between 1983 and 2002.

Labor unions are organized on local and national levels, usually by industry or trade. The primary function of a labor union is to partake in collective bargaining, the negotiation process over the terms of employment between a union and management. Union officials use this procedure to determine the wages for workers of a particular industry and to settle other worker-related issues, such as health benefits, overtime compensation, and company policy and direction. Employee associations that use collective bargaining procedures have become a popular type of labor union among white-collar professionals and other workers who have shunned traditional unions. Additionally, new kinds of union membership have been offered to workers who would like to be affiliated with a union but do not work in a union shop. These workers can become associate union members or join workplace organizations.

As a whole, union vitality remains far below levels achieved in the past. In terms of membership, only 13.2 percent of the U.S. workforce was unionized in 2002, totaling 16.1 million members. Government workers were far more likely to be unionized, especially at the local level. After government, the most heavily unionized industries included transportation, in which 24 percent of the workforce was organized. Other sectors with high unionization rates included construction and manufacturing. Men belong to unions slightly more than women, with respective unionization rates of 14.7 percent and 11.6 percent. Among all employed wage and salary workers, those not represented by unions earned an average of $587 per week, whereas union members earned $740.

Unions faced a number of challenges in the early 2000s. Chief among these concerns was the nature of the labor union itself. The sharply diminishing ranks of unions during the previous 30 years combined with the increasingly global and mobile nature of business sparked debate as to whether the organizational structures and practices of unions were applicable to the modern economy. At the other end of the spectrum, labor activists countered that while definite improvements and restrategizing were indeed in order, unions were never more necessary than when faced with the constant threat of strongly leveraged management afforded by the increasing mobility of trade and investment. The challenge was thus to rethink labor practices to strengthen labor's position in the changed economic environment.

Organization and Structure

The American labor movement can be divided into two types of unions: craft and industrial. Craft unions were the first unions established in the United States and are comprised of workers who share a common occupation, skill, or trade. An industrial union includes all workers related to the production of a particular product, including skilled, semiskilled, and unskilled labor.

This distinction has been an important issue in the history of organized labor. The American Federation of Labor (AFL), founded by Samuel Gompers in 1886, favored craft unions. Over time and under the direction of various leaders, the Congress of Industrial Organizations (CIO) was created specifically for industrial unions. The differences between these two kinds of unions are not as apparent today because rapid changes in technology have blurred many remaining distinctions.

Probably the most recognizable name related to the American labor movement has been the AFL-CIO. This group is a "union of unions," a federation of free and autonomous labor organizations. A voluntary membership group, the AFL-CIO includes 65 unions that represent more than 13 million workers. Membership has been limited to national unions, although a few local unions also belong to the federation directly. National unions have been the backbone of the American labor movement. Membership has been concentrated in the largest national unions, such as the Teamsters, the Auto Workers, the Steelworkers, the Carpenters, and the United Mine Workers. Regardless of AFL-CIO affiliation, these groups have been responsible for collective bargaining.

In addition to setting the price of labor in a particular market, collective bargaining allows unions to share in decision-making processes with management. Collective bargaining establishes a system of checks and balances against the authority of management. With this negotiation strategy comes a new way of making and interpreting rules, known as the "grievance procedure." This is essentially a judicial process that ensures that the collective bargaining agreement is being properly applied and interpreted.

The 63,000 local unions in the United States have been primarily responsible for grievance procedures. Nearly 98 percent of local unions are subdivisions or chapters of national unions, although a few are affiliated directly with the AFL-CIO or are completely independent. Approximately 22,000 local unions are affiliated with six national unions that have 2,000 or more locals each.

Unlike the distant relationship between national unions and the AFL-CIO, locals typically are strictly controlled by their national leadership. The status of these locals lies entirely under the administration of the national leadership, who often disband locals deemed expendable or uneconomical to maintain. Generally, locals require permission from the national administration to call a strike, though unsanctioned "wildcard" strikes are not uncommon. National representatives are usually charged with engaging in collective bargaining on behalf of local chapters. Despite this "top-down" leadership, the local union has been a significant part of organized labor because it has been the point of contact between the member and the union. Nonetheless, recent years have witnessed heightened demand for greater direct or more representative democracy emanating from the local chapters up to the national administration.

Employee associations, like labor unions, participate in collective bargaining, but they are less hierarchical than the unions. These groups may be the best way to organize professional and white-collar employees who are interested in collective bargaining but have reservations about being identified with a union. Approximately 2.56 million people, or 10 percent of the total U.S. union membership, belong to employee associations. The largest employee association is the National Education Association (NEA). Boasting over 2.5 million members, the NEA has surpassed the Teamsters (1.4 million members as of 2003) as the largest union in the United States. Other employee associations with over 100,000 members include the American Nurses Association, Classified School Employees, the Fraternal Order of Police, and the California State...

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