Study - The Economic Implications of EFCA

by Mike Eastman

Union leaders have made much about how passage of the Employee Free Choice Act (EFCA) would increase union membership. SEIU President Andy Stern has estimated that passing EFCA would lead to 1.5 million new members per year for the next 10 years. Finally, we have an economic study that explains what the impact of such an increase in union density on the economy. Dr. Anne Layne-Farrar, an economist from the non-partisan firm LECG consulting, has a new study out today on how the "Employee Free Choice Act" (aka Card Check) would negatively impact the landscape of the U.S. economy, increasing unemployment and stifling job growth for all Americans.

According to the study, An Empirical Assessment of the Employee Free Choice Act: The Economic Implications, an increase in 1.5 million union members in one year would lead to the loss of 600,000 jobs by the following year. Jobs losses directly attributed to the passage of card check legislation would be equal to the entire population of Boston or seventy-five percent of San Francisco. Dr. Layne-Farrar further notes that if Andy Stern’s prediction were to come true then "unemployment is predicted to rise between 5.3 and 6.2 million."

I think Randy Johnson (my boss) summed it up well when he said, "Unions claim they are the ticket to the middle class, but this study confirms that passing EFCA would have a damaging effect on an already weakened economy. This legislation is a bad idea any time, but is particularly irresponsible at a time when policy makers should be focusing on creating, not destroying, jobs."

The study, funded by the Alliance to Save Main Street Jobs, complements a recent report authored by renowned legal scholar Richard A. Epstein titled The Case Against the Employee Free Choice Act and is consistent with the Chamber’s own work in this area recently published in a series of white papers, including Are Unions the Ticket to the Middle Class? The Real Economic Effects of Labor Unions.

Comments

[Linda kreiling]

Why would anyone want to get rid of the middle class?

[Louweegie272]

Not sure why you lobby so hard to stop E Verify? Having legal workers
who have basic rights shouldn't be a problem for any law abiding, honest American Company, should it? I could see how you would not want Unionization of your workers, that would give them even more power than if they were merely being legal citizens, wouldn't it?

[ChamberPost]

1. Wrong - http://www.chamberpost.com/2009/03/efca-mythbusting---union-cant-organizing-under-secret-ballots.html

2. This was a survey, not a study.

3. I believe you are talking about the work of Kate Bronfenbrenner who came this data point from data provided by lead union organizers in union organizing campaigns—hardly an unbiased source.

4. See 1

[JC]

Well, the current system for unionizing workers is broken, and it was broken by anti-labor folks like those at the Chamber. More than 60 percent of Americans have stated that they would join a union, but studies (sorry, Chamber, these are REAL studies) show that employer intimidation during a union election is real--pro-union employees are fired from their jobs in more than a quarter of all organizing campaigns.

So what's the Chamber's solution? I'm sure the Chamber would love for the rules to stay the same. As they are right now, the laws about joining a union greatly favor big business and are clearly unfair to those seeking representation.

[dawna]

the unions made the middle class. I'm sure you would love to get rid of the middle class.