Union Organizing in the Manufacturing Industry

The manufacturing industry faces numerous challenges, and all of them affect employees. A few issues are digitization forcing job restructuring and higher level skills, globalization and increasing use of robotics eliminating jobs, changing consumer preferences for ethically made products, inflation, trade policies causing a loss of jobs, and a pro-union government. The impact on union membership is significant as manufacturing becomes less labor-intensive due to job losses and an aging blue-collar workforce reaches retirement age. Labor union membership rates have been on the decline for decades, so labor unions are ramping up their union organizing in the manufacturing industry to stop the decline by focusing on the issues impacting manufacturing workers today and striving to attract younger workers. 

State of Manufacturing Unionization 

There has been a steady downward trend in union membership. In 1985, there were almost 5 million union members in manufacturing, compared to 1.18 million in 2021. A lot of analysis has been conducted to determine the reasons for the decline, and there are many reasons named like those mentioned already. Some other facts are important to understanding union organizing in the manufacturing industry.   

• Businesses are all sizes - Though we think of manufacturing firms as being big production facilities, most are small-to-medium-sized enterprises, per the U.S. Census Bureau. In 2019, 74.3 percent had less than 20 employees, and 87.7 percent had less than 50 employees. However, 57.9 percent of all employees worked for companies with more than 500 employees. Labor unions are targeting all sizes of manufacturing businesses. 
• Employment has increased in 2022 – Due to turmoil in the globalized marketplace and a focus on bringing manufacturing jobs back to the U.S., manufacturing employment is trending upwards. In September 2022, another 22,000 people were hired, and employment increased by 48,000 people above a peak in July 2019. Labor unions recognize opportunities for promoting unionization in the currently expanding manufacturing industry and among younger employees.  
• Projected change in manufacturing jobs is negative for 2021-2031 – The BLS projects a .1 percent decline in employment for 2021-2031 or 139,400 people. This is a further threat to labor union membership.   
• Salary inequity between men and women exists – Deloitte tracks the manufacturing sector and reports the average male salary is $70,420, and the average female salary is $68,720. Inequities exist across the board. For example, male frontline supervisors of production and operating workers earn $55,126, while women earn $51,477. Differences in earnings are a common labor union focus.   
• The average employee is Gen X – The Deloitte data also reports the average employee is an older Gen X or younger millennial at an average employee age of 43.7 years. This is an age when issues like pension plans become important. Benefits remain an important point of contention with labor unions. The BLS reports that 79 percent of manufacturing employees have access to employer-sponsored benefits, 90 percent to health care, and 95 percent to paid vacation. These numbers don’t include employees at suppliers, though, which is one reason labor unions are targeting them also (see the next section).   
• Lack of diversity is an issue – Per the BLS, 79.5 percent of workers were White; 10.3 percent were Black or African American; 7.1 percent were Asian; 17.4 percent were Hispanic. The manufacturing sector has struggled to increase workforce diversity, so labor unions have adopted this as an organizing point. 
• Globalization has disproportionately impacted employees of color – EPI research found that globalization has eliminated five million jobs. Black workers experience a loss of 646,500 jobs between 1998 and 2020, which is a 30.4 percent decline. Job security is another top labor union issue. 

The manufacturing industry currently employs 12.8 million people, making it among the top five largest employment sectors.  

Common Labor Union Issues in Manufacturing 

The labor unions are focused on manufacturing because there are so many issues that fit their narrative, and there is a long history of success in unionizing. Following are some of the current labor union issues.  

Getting Subsystem Employees Included in National Union Contracts 

The manufacturing sector has a workforce makeup that is similar to the workforce in the tech industry. There are regular employees working at the main plants and employees working at subsidiaries. Manufacturing plants have employees they hire directly and subsidiaries and vendors utilizing their employees, creating a two-tiered system of sorts. General Motors (GM) is a good example.  

GM doesn’t cover the subsystem employees in the collective bargaining agreement it has with the Union of Auto Workers (UAW), and the subsystem employees earn less than plant employees. GM-UAW and GM got into a dispute over how the subsidiary employees are paid. The union also has an issue with GM not planning to include employees working at joint venture battery plants in the collective bargaining agreement. In June 2022, a strike was averted when GM reached a tentative agreement with the UAW.  

Organizing Current and Future Plants  

Labor unions view the electric vehicle (EV) sector as a prime target for gaining more members. They are having some successes, and in some cases, success is achieved by encouraging workers to strike. For example, in Ohio, Ultium Cells (jointly owned by GM and LG Energy Solutions) plant employees voted to strike to force GM to recognize the joint venture’s employees as represented by the UAW. The company wants an NLRB-certified vote, and the union wants the strike to force the employer’s voluntary recognition of the union. The strike not only addresses the union status of the Ultium Cells employees but also targets future manufacturing plants that GM and LG Energy Solutions plan on opening.   

Though not currently union members, workers can hold a recognitional strike and recognitional picketing for up to 30 days before having to file a petition with the NLRB. The labor union’s goal is to get voluntary recognition by hurting the company for 30 days with a strike or threat of a strike. If they can force voluntary recognition at some plants, it will be easier to unionize future plants. One of the challenges manufacturing plants face in defending against unions is the fact many manufacturing plants depend on arrangements like joint ventures and partnerships to ensure a steady supply of components.  

Organizing Ramped Up at the Local Level 

The UAW held its 38th Constitutional Convention this year and passed an amendment that creates a standing organizing committee at local unions. When Dakkota Integrated Systems voted to unionize, it credited the support of the regional Local 140 for its success. Local 140 helped build a local organizing committee and an organizing plan by working with a Dakkota contact. The formation of local organizing committees enables more lead follow-up, more petition filing, and more workplace organizing. 

Employee Training and Skills Upgrading 

Technology has had a major impact on manufacturing job skills requirements. There is now a manufacturing skills gap that is created by a shortage of skilled workers and the fact that employers filled approximately 63 percent of jobs lost during the start of the pandemic. Manufacturing employees today need technical, operational, and manual skills. The industry needs employees who can work in the digitally transformed manufacturing industry, and the current workforce lacks the skills.  

Even attracting younger people who do have the skills has been difficult because the industry as a whole is viewed as blue-collar work (think dirty work performed by Baby Boomers). Deloitte research found that 38 percent of industry entrants have different expectations for jobs and careers, and 36 percent are not attracted or interested in manufacturing.  

Deloitte also found that 2.1 million jobs may remain unfilled by 2030. Labor unions are pressuring legislators and employers to fund more apprenticeship programs that develop the right skills in future young workers. They also focus on the underrepresentation of women and minorities in manufacturing. Women are 1.8 times more likely to leave the industry due to a lack of work-life balance and flexible work arrangements.  

Diversity, Equity, and Inclusion (DEI) 

The DEI focus area has two parts. One part is the drive to increase the hiring of women and diverse employees in the manufacturing industry. The second part is to close the compensation gaps between employee groups, i.e., men vs. women and white males vs. people of color, and executive pay increases vs. worker pay increases.   

The Manufacturing Institute conducted a survey of 300 manufacturers in 15 industry sectors concerning DEI practices and attitudes about hiring and employee resources. This survey included all sizes of manufacturers – 40 percent small businesses, 24 percent medium businesses, and 36 percent large businesses. The survey found that 37 percent of the manufacturers struggle with D&I. Less than 50 percent of the companies have hiring, retention, and promotion plans for specific minority employees. Of the 60 percent of companies wishing to increase the hiring of minority employees, only 5 percent had programs for retaining, training, or promoting them.   

As an executive told Deloitte in the survey concerning the hiring and retention of diverse employees, “I don’t care if we are really good at recruiting more than our fair share of diverse talent. At the end of the day, people leave because of culture and the environment they’re working in.”  

This is just the kind of information labor unions can leverage for union organizing in the manufacturing industry. 

Compensation and Benefits  

Unions believe manufacturing employees are underpaid. Zippia’s research found that the median manufacturing worker salary is $14.90 per hour or $31,000 per year. Labor unions leverage information like this to demonstrate that most manufacturing employees are not earning a living wage, especially as inflation increases the cost of rent, utilities, food, and other items.   

Outsourcing of Manufacturing 

Labor unions are outraged at the outsourcing of manufacturing jobs. Though legislation like the CHIPS bill funding semiconductor manufacturing’s return to the U.S. pleases the unions, the labor unions are actively lobbying Congress for more laws protecting jobs in the U.S. Not all of this is altruistic despite claims made concerning the use of cheap labor and violations of human rights. Sending jobs overseas has contributed to the decline in union membership, so labor unions want jobs to return to the U.S. to increase membership and collect more union dues.  

Labor unions are made up of activists and attract employees interested in activism. In April 2021, the CWA newsletter discussed the fact that more than 100 labor leaders, lawmakers, allies, and environmental activists published a letter in the Boston Globe calling on General Electric to stop outsourcing and offshoring manufacturing jobs. The letter was one element of a larger campaign led by IUE-CWA Local 81201 to convince GE to invest in workers and facilities in the U.S.   

Employee Voice  

Like employees in other industries, manufacturing industry employees want a voice in the workplace. As the pro-union Economic Policy Institute (EPI) states, “Collective bargaining is how working people gain a voice at work and the power to shape their working lives.” Giving employees a voice in the workplace is a common theme for labor unions across industries.   

Job Security 

The AFL-CIO issued Resolution 31 June 12, 2022, that committed to Preserving Middle-Class Jobs: Aerospace and Defense Manufacturing. The resolution says the industry is at risk due to “pro-corporate trade deals, neoliberal globalization, and the short-term interests of Wall Street” and “lax regulators have allowed wealthy executives and financial profiteers to consolidate and monopolize the industry, squeezing the public and weakening worker bargaining power. Unfair, shortsighted trade deals have incentivized this same class to offshore jobs, leaving our supply chains vulnerable to a shock like COVID-19.” Resolution 31 also mentions that “proper investment in the training of future aerospace workers lags behind demand.”  

Labor Unions Adapting in the Manufacturing Industry 

Most manufacturing employees belong to or are affiliated with national labor unions. The AFL-CIO, UAW, and AFL-CIO are only three of the national unions. There are other large and small unions. The United Steelworkers Union (USW) is one having success in organizing. Interestingly, the USW posted a video on its website that scrolls all of its wins from 2017-2022, in which the background songs are sung in different languages, demonstrating a commitment to diversity and a desire to be recognized as more in touch with people.  

Labor unions are doing other things to adapt. They use social media to gain support and spread their message. They are using private Facebook groups, messaging apps, smartphones, and other tools to target younger workers. A sidebar to the adoption of digital or virtual organizing is that manufacturing unions have been doing some shifting to other industries, like healthcare.  

NPR analyzed petitions filed with the NLRB between January-April 2022 compared to the same period in 2012 and found that the number of petitions coming from manufacturing unions has declined by 50 percent. The reason is the firms can take manufacturing out of the country. However, that doesn’t mean they avoid unionization. For example, SINTTIA, a union supported by international activists, won an election to represent GM workers in central Mexico. The union wants employee raises above inflation and better work schedules. 

The United States-Mexico-Canada Trade Agreement required Mexico to adopt a new labor law similar to the National Labor Relations Act, assigning employee rights to a secret ballot and a transparent negotiation process leading to a collective bargaining agreement. Before the reform, companies could recognize a union and sign a contract without worker input. The law requires that independent unions be set up, and this has caused a clash of independent unions like the Independent Mexican Workers League and the old-line unions that colluded with employers, i.e., the Confederation of Mexican Workers. Unionization in the manufacturing industry is complex. National unions often operate in Canada and/or Mexico as well as the U.S, so the pressures on employees to join unions crosses borders. 

There are some independent unions. The UE Union is an example. It is the United Electrical, Radio, and Machine Workers of America that represents workers in manufacturing and public and private sector jobs. It describes itself as a “militant, democratic union” and has 100 autonomous locals as member organizations.   

Broad Reach of Labor Unions in the Manufacturing Industry 

The labor unions heavily involved in unionizing manufacturing employees have strived to gain more power by merging organizations or adding targeted industries. The Sheet Metal Workers’ International Association merged into the International Association of Sheet Metal, Air, Rail, and Transportation Workers (SMART). The parent organization is the AFL-CIO which created the AFL-CIO Industrial Union Council to bring together manufacturing unions for strategy development.  

The International Brotherhood of Electrical Workers (IBEW) established the Manufacturing Department of the IBEW to help existing local unions and help workers who want to unionize. Members work in manufacturing areas that include healthcare, communications, consumer electronics and hardware, energy, national defense, and aerospace. 

UNITE HERE is a labor union formed through a merger of the Union of Needletrades, Industrial, and Textile Employees union, and the Hotel Employees and Restaurant Employees International Union HERE). The large and fast-growing union represents workers in textile, manufacturing, and distribution, plus transportation, hotels, food service, gaming, and airports.  

Labor unions are currently supported by a union-friendly White House administration and Congress, an activist pro-union National Labor Relations Board, and a trend back towards made-in-America. 

Plan of Action for Manufacturing Employers 

The broad reach of labor unions means employers may face attempts of union organizing prompted by any of a variety of unions. You need a generic plan to prevent unionization rather than a plan based on a specific union’s tactics. The generic plan, usually developed in consultation with labor relations consultants, can be adapted as necessary to fit the circumstances as they occur.   

What do we mean by a generic plan of preparedness? There are some steps that all employers can take without a specific union in mind. These are steps known to work because they focus on developing positive employee relations, employee engagement, a positive workplace culture, and preparedness for sudden union activity. A basic or generic plan also identifies the risks and threats associated with labor unions. Combining advice from attorneys JacksonLewis, attorneys Foley & Larndner, and IRI experts, the following is a laundry list of steps your company can take now.   

• Assess your communication processes to ensure all employees are included in messaging and can provide feedback to your leadership. 
• Conduct employee engagement surveys to identify their needs. 
• Ensure that employee-leadership communication is two-way. Leaders at all levels should be communicating with employees regularly, from the CEO to the frontline supervisors. 
• Train all your leaders in developing positive employee relations with employees. A key component is strengthening employee engagement.  
• Analyze your Human Resources policies and address areas that create union vulnerabilities, like safety procedures and work schedules. 
• Analyze your compensation schedule and benefits plan, comparing them to competitors and industry standards and identifying ways to meet or exceed labor union demands. 
• Develop a DEI recruitment, hiring, retention, and promotion plan for diverse employee groups. 
• Invest in employee training to upskill the workforce. 
• Assess supply chain companies providing critical components and materials to identify suppliers with union vulnerabilities that could affect your ability to maintain positive relationships with employees or influence your employees to unionize. 
• Assess vendors supplying services like transportation and warehousing concerning their union status to determine if they present a union vulnerability. 
• Conduct a union vulnerability assessment which can include identifying potential small-bargaining units to see if there are ways to minimize their existence through job classifications or restructuring job responsibilities. 
• Become an employer of choice by creating a diverse and inclusive culture, maintaining a good reputation online, addressing employee needs, developing and implementing DEI plans, and developing leadership communication skills. 
• Respond to employee expectations, and don’t ignore them even when unable to meet them. 
• Connect with and invest in local communities because they have a lot of influence. 
• Identify the labor unions in the local and regional area that are most likely to attempt to organize your workforce and stay on top of their activities. 
• Develop a basic response plan to adapt and implement should a labor union try to start an organizing campaign. Some companies create a readiness response team to prevent union organizing.  

Stay Proficient in Labor Relations in the Manufacturing Industry 

If you see signs of union organizing, then it’s time to get more specific as to your response. It’s important that all of your managers and supervisor stay proficient in labor law and labor relations, whether or not your organization is unionized. If unionized, it will help you avoid unnecessary clashes with the unions and unfair labor practice charges (ULPs). If not unionized, leaders with good labor relations skills are crucial to keeping employees disinterested in unionizing.  

Maintaining a workforce free of unions is not easy in the manufacturing industry because of the complexity of the business environment and aggressive labor unions. IRI Consultants works with manufacturing companies to position them as employers of choice through organizational development and assists them in reducing vulnerability to union organizing.