On Wednesday, December 3rd, Michigan Governor Jennifer Granholm released a statement calling for the quick passage of the Employee Free Choice Act. Governor Granholm called the legislation a "vital part of an effective economic recovery program" because "American workers provide critical fuel for the engine of economic growth." Governor Granholm also highlighted the incoming administration's commitment to signing the bill into law. Read SEIU President Andy Stern's statement on Governor Granholm's support here.
Governor Granholm's statement was punctuated by the release of the latest unemployment numbers today - even more bad news for working families. 533,000 U.S. jobs were lost in the last month alone, the biggest drop recorded in 34 years according to the Bureau of Labor Statistics. The latest news isn't unexpected, but pressure is on Congress to take steps to fixing our broken economy. Now, more than ever, it's clear that we need solutions that work for the millions of middle class Americans who have lost their jobs or worry that they'll be next.
Over the past three decades, our economy has grown. But most of the benefits have gone to the wealthiest Americans, while middle class families have seen their wages flat-line or decline. One thing is clear: restoring our middle class is the key to getting our economy back on track. And one of the best ways to help American families improve their standard of living is to pass the Employee Free Choice Act. By offering workers a fair and simple path to forming unions, workers will have the opportunity to earn better wages and benefits. Workers in unions earn 30% higher wages and are 59% more likely to have employer-provided health insurance.
Below is our assessment of the Employee Free Choice Act in an economic context for your reference.
An Economy That's Out of Balance
In the post-war period, workers' incomes were tied to productivity - America's business did better and workers shared in the success they helped create. And we built the biggest and strongest middle class in the world. But in recent years, productivity has continued to increase, while wages have flat-lined. Corporate profits and CEOs have benefited, but middle class household incomes have declined. In the last eight years, real median household income declined by more than $1,000 while corporate profits nearly doubled. Yet in 2007, "CEOs of large public companies averaged 344 times the average pay of workers." (NYT 9/18/08).
Consumer Demand in A Slump
The stagnant incomes of America's middle class are causing a fall off in consumer spending at a time when our economy needs it the most. Consumer spending is the engine that drives the American economy, representing more than 70% of total U.S. demand. Restoring the wages - and the spending power - of working families has got to be part getting our economy back on track.
Creating an Economy that Works for Everyone
Historically, unions have helped build a strong middle class and a stable American economy based on high wages. Over the past 30 years, as union membership has declined, workers' wages have fallen behind as the wealthiest Americans captured almost all of the gains our economic growth. The result is that our current economy - based on debt - is unstable. Encouraging unionization to increase average American's earning - and thus spending - power will restore our middle class and help revitalize our economy.
The Employee Free Choice Act is an integral part of restoring America's struggling middle class and creating an economy that works for everyone, not just those at the top. A strengthened middle class with greater earning - and spending -- power is a key to building a sustainable economy.
