Right to Work North Dakota’s Economic Boom Isn’t Just About Oil

CARPE DIEM: North Dakota’s Amazing Economic Success; It’s Not

PN Bakken: Anderson: North Dakota not just about oil – May 06 


For some time now, it’s been widely reported that North Dakota, a Right to Work state since 1948, has a booming economy. Influential economics commentator Mark Perry laid out the key data well in a post (first link above) for his Carpe Diem blog earlier this month:

The Peace Garden State’s jobless rate is the lowest in the country at 3% for March, more than five percentage points below the national average of 8.1%. Per-capita personal income in North Dakota increased more than 78% since 2000, more than double the 37.4% increase in per-capita income nationally.

Faced with such indisputable data, apologists for forced unionism such as Economic Policy Institute researcher Gordon Lafer posit that North Dakota’s outstanding economic growth is solely due to the success of its energy industry, and has “nothing to do with” Right to Work.

Unfortunately for Dr. Lafer and other Big Labor cheerleaders, the data indicate that North Dakota’s success is broad based and that labor policy is an important factor. A  recent analysis by North Dakota Commerce Commissioner Alan Anderson, cited extensively in the second link above, points out that oil makes up just 25 percent of the state’s revenue collections.

The Rough Rider State’s high-quality workforce is spurring information technology job growth “triple that of the nation” in North Dakota. The state’s manufacturing sector is also showing strength, as Mr. Anderson details:

One example is the recent expansion announcement by Caterpillar in West Fargo. Construction has started on a $50 million project that will create about 250 new jobs during the next three years, nearly doubling the plant’s current workforce. Caterpillar officials told us that North Dakota’s pro-business climate was a major factor in its decision to expand in West Fargo. Phoenix International, a company that manufactures electronics for John Deere, recently broke ground on a $22 million expansion project that will include 90,000 additional square feet in Fargo for an expanded work force.

North Dakota’s Right to Work law helps mitigate the damage of Big Labor monopoly bargaining in unionized industries. It also largely prevents the state’s union bosses from fueling their political machine with forced union dues. It’s not surprising, then, that North Dakota has far lower taxes and far fewer business-choking regulations than the typical forced-unionism state. Energy has certainly been a boon for North Dakota, but so has the state’s ban on compulsory union dues.