Nearly Three-Quarters of U.S. Automotive Manufacturing Jobs Located in Right to Work States

Excluding Indiana and Michigan, which both adopted laws prohibiting compulsory unionism in 2012, the real-dollar share of all automotive and automotive parts production occurring in Right to Work states rose from 39.6% in 2004 to 53.8% in 2014. Image: South Carolina Department of Commerce

Long before the U.S. Commerce Department’s Bureau of Economic Analysis issued its state-by-state estimates for manufacturing output of motor vehicles, bodies and trailers and parts in 2014 early this week (see the link below for more information), it was easy to predict the data would show more than 70% of U.S. auto production that year occurred in one of the 24 states that had Right to Work laws on the books at the time.

Now that the data are out, one can say, more precisely, that the Right to Work share of real automotive manufacturing GDP (expressed in chained 2009 dollars) in 2014 was 71.2%.

As recently as 2004, just 24.4% of the total U.S. output in automotive factory emanated from Right to Work states (then 22 in number).

A large share of the Right to Work growth from 2004 to 2014 can be accounted for by the fact that Michigan and Indiana, respectively #1 and #2 in automotive manufacturing output, both passed laws prohibiting compulsory unionism in 2012. But this is far from the whole story.

Excluding Michigan and Indiana from the U.S. total, and considering just the 22 states that had Right to Work laws from 2004 to 2014, the Right to Work share of U.S. automotive manufacturing output grew from 39.6% to 53.8% over the decade. Real manufacturing GDP in these 22 states grew by 64.0% from 2004 to 2014, but fell by 7.6% in the 26 states that still lacked Right to Work protections as of 2014.

The overwhelming advantage Right to Work states states have enjoyed over forced-unionism states in attracting automotive manufacturing investment ought to put the burden of proof on Big Labor legislators in forced-unionism states like Missouri, Kentucky and Ohio who claim it makes no difference to companies considering new plant construction or expansions whether unionism is voluntary or not.

If that’s the case, how do they explain why automotive manufacturing is soaring in Right to Work states as a group, but stagnant in forced-unionism states as a group?

Real GDP in chained dollars