11 January 2011

Have Unions jumped the shark?

Just in the last few weeks I've wondered if the days of Unions helping employees have passed. I believe they had a season where they were necessary, but some things occurring lately make me wonder if something else needs to evolve.

We've been closely watching the economic conditions in Spain, anticipating our return. The government is close to or probably past going bankrupt like Greece. They have called for austerity measures and because of that the unions of every type representing mostly people paid by the government, which is most of the people, are staging protests.

Protests that THEIR pay cannot be cut; it's not possible. Of course, the fact of the matter is that the government cannot keep up. They've already raised taxes a few times and lowered the retirement age trying to force more jobs for the 20 percent unemployed. 

I hear of Michigan which was a mecca of union jobs, but it appears they raised the bar so many times on the employers that the employers fled. It's almost as if the unions disregard common sense or the circumstances of the day, and just keep the benefits or pay going higher regardless of whether the industry can sustain it.

In Hollywood, the movie industry has unionized to the point of one person who loads film, one who takes it to the processors, one who shows the daily developed film. You can get in trouble if you do something logical like adjust a light if you are a camera person. Two things are wrong. The jobs have all become contract because no one wants to pay anyone fulltime for this tiny single job that the union allows them to do. It makes people not be able to cover multiple roles at one time - to multitask if you will. The other thing that is wrong is that media is changing. It's smaller; it's more streamlined; it doesn't need actual film anymore. The jobs are not as singular as they were 40 years ago. The union is holding fast to the former days and may lose the race. A team of 7 or 8 nonunion hobbyists in the industry are making up the cutting edge of film in Vietnam and they are being backed financially by new media types. Times they are a-changing.

Is it possible that one can over protect a job so much as to protect yourself out of the business completely?


  1. This is a hairy issue because there are so many types of unions and so many different situations. My understanding is that private sector unions generally negotiate with some understanding that the business has to stay competitive, but public sector unions have no such concerns. Generally speaking, the defense against public sector unions is to hire contractors to do government jobs, but that is probably easier to implement in some countries by politicians in some parties than in others.

    Unions have made more sense in the past when the economy was more manufacturing-based and skillsets were specifically tailored to jobs that did not transfer to other fields. They have also made sense in situations where management had little incentive to provide basic needs. Some of those conditions still exist in some places today, but they are not as wide-spread. I actually think that the direction that the economy is going is the exact opposite where most workers will be contract workers who are not actually employees of the companies they work at because the ability to match skills in the marketplace to needs is getting easier, so companies will not have to expend as much energy finding someone who will provide needed expertise for a three-month-long project.

    In my MBA courses probably the main point made about unions is that the tension between management and unions is able who gets to make the business decisions. It may be necessary for the business to bow to the unions demands, but the flip side is that it makes the business less flexible.

    All that said, there are union success stories. The main one that comes to mind is Southwest Airlines. They know how to hire and what to concede and not to concede to unions, though, because they understand what it is that gives them a competitive advantage. There are probably more companies that don't know how to deal with unions than know how to deal with unions.

  2. Dust, you've obviously read more than I have on the subject. My observations were more current events based. I'm not anti-union but I see the economics changing so much. I agree we are going to see more and more contractors for seasons. The media field has basically already gone that way.

  3. I think your observations are right.