Wages Up in RTW States

by

Natalie Johnson has the good news about Right to Work states in the Daily Signal.

 

Right to Work States, National Right to Work Legal Defense Foundation

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.

 

PageLines