Households in Forced-Dues State Have Less to Spend

By Stan Greer | November 6, 2019 | 5:05am EST
A banner for a 5 dollar an hour minimum wage at Los Angeles International Airport on October 2, 2019. (Photo by FREDERIC J. BROWN/AFP via Getty Images)
A banner for a 5 dollar an hour minimum wage at Los Angeles International Airport on October 2, 2019. (Photo by FREDERIC J. BROWN/AFP via Getty Images)

On paper, it seems like employees in forced-unionism California are well-off.  Data recently published by the U.S. Commerce Department indicate that, last year, the average annual compensation (including cash and benefits) for full- and part-time private-sector employees in the Golden State was roughly $59,000.

But the reality is that working-age Californians recognize they don’t live so well relative to their counterparts in other states.  That’s the primary reason why, as demographer Wendell Cox recently noted, “2.2 million more residents have moved out to other states than in” since 2000.

A September statewide scientific poll of registered voters sponsored by the University of California, and cited by Cox,  shows that more than half are currently giving “serious” or “some” consideration to leaving the state.  Household heads aged 30-49, the time of life when Americans are commonly buying homes and raising families, are the most desperate of all to get out, with an average of roughly 60% inclined towards an interstate move.

Californians obviously understand what many of the state’s cheerleaders, including numerous union spokesmen, choose to overlook:  The standard of living for any employee, unionized or union-free, depends on his or her living costs and tax burden, as well as nominal pay.  That’s why living standards in Right to Work states generally are higher than they are in forced-unionism states, including California.

For many years now, employees considering relocation to another state and companies seeking to hire capable employees from out of state have been able to consult interstate cost-of-living indices that are calculated and published by the Missouri Economic Research and Information Center (MERIC), a state government agency.

MERIC’s annual data for 2018 show that, among the 14 states with the highest overall cost of living last year, not one has on the books and in effect a Right to Work law barring the termination of employees for refusal to join or pay dues or fees to an unwanted union.  But 13 of the 14 lowest cost-of-living states were and are Right to Work.

Along with housing, food and utility costs, overall tax burdens are substantially lower in Right to Work states than they are in forced-unionism states.  In 2018, according to estimates furnished by the Washington, D.C.-based Tax Foundation, residents of forced-unionism states  forked over 31.6% of their total personal income in federal, state and local taxes, a 13% higher share than the Right  to Work state average.

A recent National Institute for Labor Relations Research analysis of U.S. Census Bureau data found that the average cost of living-adjusted, after-tax income per household in Right to Work states last year was $60,806, roughly $4,300 higher than the forced-unionism state average.

No one should be surprised by the Institute’s findings.  The forced-union-dues system foments hate-the-boss class warfare in many workplaces.  And union bosses funnel a large share of the forced dues and fees they collect through this system into the campaigns of Tax & Spend, regulation-happy politicians.  It is only logical that, in states where forced union dues and fees are still permitted, workers and other residents would end up with less real purchasing power.

Cost of living-adjusted, after-tax federal data confirm that’s exactly what happens.  But many statistics regarding incomes in Right to Work and forced-unionism states cited by Big Labor propagandists ignore regional cost-of-living differences completely.

For example, even though the Census Bureau has since 2011 regularly calculated and published data measuring poverty adjusted for differences in housing costs, Big Labor and its allies never reference these data, which show poverty is lower in Right to Work states than in forced-unionism states.

Instead, forced-unionism apologists simply ignore the relevant data and claim, in essence, we would all be better off if union officials could just force everyone to pay union dues or fees to get or keep a job. Ordinary Americans who know in their hearts that compulsion of employees is morally wrong must never allow themselves to be taken in by such special pleading.

(Stan Greer is the National Institute for Labor Relations Research’s senior research associate.)


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