Natalie Johnson has the good news about Right to Work states in the Daily Signal.
Private sector wages are not reduced in right-to-work states as union advocates have argued, according to a new report released Tuesday by The Heritage Foundation.
James Sherk, a research fellow in labor economics at The Heritage Foundation and the author of the study, cited an Economic Policy Institute paper that claimed right-to-work laws reduce wages by 3 percent.
Sherk found the conclusions “fundamentally flawed” because the study only partially accounted for the cost of living differences across states. He said this is a problem because companies in states with higher costs of living pay their employees higher wages to account for steeper expenses.
Every state with compelled union membership and Virginia, a right-to-work state, has living costs above the national average, which is how EPI arrived to its finding that right-to-work states have lower wages.
Once cost of living was accounted for in the Heritage study, Sherk said EPI’s results “disappeared” and right-to-work laws had no effect on private sector wages.
“All of these arguments of right-to-work wages really evaporate when you look under the hood of all these studies,” Sherk said.
Though more than three-quarters of Americans believe union membership should be voluntary, 25 states still have compulsory unionization.