Forced Unionism Correlated With Greater Income Inequality

Judging by the many publications of the Big Labor-funded Economic Policy Institute, the academics who work or volunteer for this organization love compulsory unionism, and detest income inequality.  But the EPI’s own data show that, almost certainly to its chagrin, household incomes in forced-unionism states are on average more unequal than are household incomes in Right to Work states.

The latest edition of an ongoing EPI study regarding the “unequal states of America” (see the link below to obtain an electronic copy) includes a table, based on IRS data, data from other sources, and the authors’ own calculations, listing the average income of the “top 1%” of  households in each state and the average income of the “other 99%” of households in each state.

In the typical state, the “top 1%” of tax-filing households earn a little more than one-fifth of all taxable income.  But in some states income inequality is far higher.  In forced-unionism Connecticut and New York, for example, the two states with the greatest income inequality, the “top 1%” took in 34.0% and 32.8%, respectively, of all household income.

On average, the “top 1%” in the 27 states that lacked Right to Work laws as of 2012 took in 23.1% of all household income in their states that year.  That’s a significantly higher share than the 21.6% average for the 23 states that had Right to Work laws on the books in 2012.  (Michigan’s and Wisconsin’s Right to Work laws took effect in 2013 and this year, respectively.)

The fact that Right to Work status is correlated with less income inequality does not in itself prove that Right to Work laws lessen inequality.  However, this correlation does make it highly improbable that Right to Work laws exacerbate inequality.  Until they can first show that Right to Work states have some common feature unrelated to labor policy that lowers inequality, Big Labor academics will have no logical grounds for claiming it’s even possible that voluntary unionism benefits the “1%” at others’ expense.

But proponents of monopolistic unionism like Robert Bruno of the Illinois Economic Policy Institute don’t seem to care.  In testimony delivered to a U.S. House panel last week, Bruno cited an analysis made by ex-union official Lonnie Stevans as the basis for his contention that Right to Work laws “redistribute income from workers to owners.”  Unfortunately for Bruno and Stevans, the findings of their ideological allies at the national EPI point in the opposite direction.  If anything, forced unionism intensifies income inequality, rather than reduces it.

Objective data show that, in 2012, the aggregate income of the “top 1%” of households in forced-unionism states constituted 23.1% of these states’ total income. Meanwhile, the aggregate income of the “top 1%” of households in Right to Work states constituted 21.6% of these states’ total income. Yet in testimony delivered to a U.S. House panel last week, professional forced-unionism apologist Robert Bruno contended Right to Work laws somehow promote income inequality! Image: UIC Action Center


The Increasingly Unequal States of America 1917 to 2012