Labor Unions In The Modern Market: A Case Study

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The greatest detriment that labor unions cause companies in a modern market, is a reduction in the amount of investment dollars that a corporation receives. These devoted funds are the lifeblood of a company. The shareholders are the people that have the ability to make or break a business. Investors need to know that they will receive a return on their investment. This means that they want to make more money than they put in.
There are several factors that might deter a person of this status from giving money to a company with unionized labor. The first of these deterrents is the risk of work stoppages. The Bureau of Labor Statistics relates some of the results of work stoppage. It says that “The longest and most days idle of any
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A prime example of this happened in the motor industry in the 1970’s. Detroit, Michigan was the automobile manufacturing capital of the world. Because of companies like Chrysler and GM, it was the largest producer by far. Because of labor unions, employees’ wages were much higher than they normally would be in a non-unionized competitive market. This drove up the price of cars for consumers. This was fine until foreign markets entered into American. According to The Capital Research Center in an article written by James Sherk, he states “In the late 1970s foreign automakers entered the U.S. auto market. In many cases they did not make “foreign cars.” Instead, they produced vehicles built by American workers in the United States—but built by nonunion workers in southern states. Consumers could now choose whether or not to buy cars made by UAW (automobile labor union) members who worked for automakers headquartered in Detroit. This competition hugely benefited the economy. Consumers decided that foreign automakers transplanted to America were making cars of higher quality and lower cost than Detroit’s. To stay competitive Detroit automakers had to cut their costs and increase their quality.”
With the labor union culture so deeply engrained within the Detroit based companies, they were not able to make the necessary increase
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Anything not listed above are items which are non-necessities. People often confuse rights with privileges. Not having to worry about your employment being terminated because of race, religion, or gender is a right. These are factors beyond the control of the person, and have no influence on the effectiveness of the employee. Wage rate, vacation time, and job security based on performance are privileges. To attain these things, it is important that the employee earn his or her keep. A higher education for example, requires that someone put in years of hard work and thousands of dollars into furthering their training and learning. They become more valuable to a company and therefore, deserve higher wages. Another example would be an employee offering years of dedicated service to a company. Putting so much of yourself into a company for so long will usually pay dividends, normally coming in the form of more vacation time and a raised wage. The lazy, entitled worker might look at the non-unionized world as a big disadvantage to the working man. But someone who is driven and hardworking, looks at it as an opportunity. Labor unions restrict growth of its respective employees, a little more now for a lot less later. Potential is literally unlimited if a person is allowed to grow and progress, experiencing the highs and lows of the business

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