STUDY: Missouri Workers Would Lose “Between $4.58 and $6 Billion Annually” Under ‘Right-to-Work’

by Chaz Bolte

cl_RTW_For_Less_NoD_271c8Rule one in the “Right-to-Work” implementation playbook is to tie its potential passage to an inevitable economic rebound.  Yet, history has shown that “Right-to-Work” is more of an economic slow bleed than a miracle maker.

As the Missouri state legislature prepares to debate the merits of becoming the 25th “Right-to-Work” state in the U.S., it is important for the general public to understand the ramifications of such a path. And a new report released Monday by University of Missouri-Kansas City professor Michael Kelsay helps with that very task, concluding that “Right-to-Work” laws would severely harm Missouri’s middle class workers.  The numbers for statewide income loss? In the billions.

The findings in “An Economic Analysis of the Adoption of Right to Work On Missouri Families” include:

–“Right to Work” would result in an economic loss of between $1,945 and $2,547 annually per household for Missouri families.

– Missouri workers combined would lose between $4.58 and $6.0 billion annually as a result of lower wages.

– State, local, and county jurisdictions would lose between $82.14 and $107.56 million annually in lost sales tax collections as a result of lower wages.

– The State of Missouri would lose between $137.28 and $179.89 million annually in income tax revenue as a result of lower wages.

– “Right to Work” states had a higher percentage of their population living below the poverty level in 2012 than states without these laws.

– “Right to Work” states had lower per capita GDP growth in 2012 than states without these laws.

– “Right to Work” is not an important factor for where businesses decide to locate.

One pro-RTW talking point the study debunks is the suggestion of job creation.  Dr. Kelsay’s work indicates that “Right-to-Work” has little effect compared to other environmental factors.

Simply put, all credible statistical evidence to date shows no relationship between right-to-work and economic growth or employment. Dr. Lafer (2011) has pointed out that if one looks at per capita income over the past thirty years, four of the five fastest growth states were free-to-bargain states; and ten free-to-bargain states grew faster than 75% of the right-to-work states. In addition, there is simply no correlation among 75% of the right-to-work states. In addition, there is simply no correlation among unemployment rates. If one examines employment rates in October, 2013, the states with the highest and lower unemployment rates were both found in right-to-work states: Nevada at 9.3% and North Dakota at 2.7%.

If one examines manufacturing employment over the past decade, one sees wide disparities in the loss of manufacturing jobs. If one examines Missouri and the eight states contiguous to Missouri, Tennessee, a right-to-work state, had the largest percentage of manufacturing jobs lost at 39.6%, while Nebraska, also a right-to-work state, had the lowest percentage of manufacturing job loss over the past decade, at 19.6%.  In between these two states in the region are three free-to-bargain states and six right-to-work states.

In the literary review of the study, Dr. Kelsay notes that “Right-to-Work” has a direct correlation with safety standards in the construction industry.  Workers have higher rates of fatality compared to the union workforce.

Utilizing occupational data for the period 2003-2009 and industry fatality data for the period 2001-2009, he reported that the fatality rate is 40 percent higher for industry fatalities and 34 percent higher for occupational fatalities in right-to-work states.

His regression analysis found that unionization is associated with lower industry and occupational fatality rates, and this positive union effect is stronger in states without right-to-work laws.

To read the full study visit Protect Missouri Families.

Chaz Bolte is a native of Pittsburgh, PA where he attended Slippery Rock University. He currently contributes to WePartyPatriots, Addicting Info, Secret Party Room, and Football Nation. This post originally appeared on We Party Patriots. You can follow him on Twitter @ChazBolte

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One Response

  1. […] As the Missouri state legislature prepares to debate the merits of becoming the 25th “Right-to-Work” state in the U.S., it is important for the general public to understand the ramifications of such a path. And a new report released Monday by University of Missouri-Kansas City professor Michael Kelsay helps with that very task, concluding that “Right-to-Work” laws would severely harm Missouri’s middle class workers.  The numbers for statewide income loss? In the billions. Read the source story here. […]

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