‘Expect Firms Both American and Foreign to Look to Open Plants’ in Right to Work States
Arthur Herman
If you relied on Capitol Hill politicians and union officials for all your information on manufacturing in the U.S., you might well believe it has been rapidly disappearing in recent years. But data from the U.S. Commerce Department’s Bureau of Economic Analysis tell a very different story. They show that, from 2001 to 2011, real manufacturing GDP (in constant, “chained†2005 dollars) increased in 40 of the 50 states, and aggregate U.S. factory output increased by 26.3%. (See the second link above for more information.)
Real manufacturing GDP in the 22 states that had Right to Work laws on the books barring forced union dues and fees during the first decade of the 21st Century expanded by an average of 33.0%, 6.7 percentage points more than the national average and 9.1 percentage points more than the average for the 28 states that did not have Right to Work laws at the time. (Early this year, Indiana became the 23rd Right to Work state.)
In a Wednesday op-ed for the New York Post, historian and American Enterprise Institute visiting scholar Arthur Herman briefly discussed one important reason why Right to Work states are typically more attractive to manufacturing investors:
As the number of right-to-work states grows . . . expect firms both American and foreign to look to open plants where labor isn’t stifled by union rules, and where they can deploy the latest “smart†manufacturing technologies.
Michelin is breaking ground on a new plant in South Carolina; Volkswagen has new facilities in Chatanooga, Tenn., and Airbus is building a $600 million plant in Mobile, Ala. Samsung plans to invest more than $20 billion in various U.S. manufacturing enterprises [and is reportedly scouting sites in Northern Texas].
Those “smart†technologies involve lasers and new artificial materials and alloys – as well as computerized databases and cloud information technology to lower costs and speed up delivery. Just around the corner: “3-D printing,†which can make specific products literally at the click of a mouse – including athletic apparel.