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Labor Day

November 24, 2009

It marks the symbolic end of summer and beckons the children back to school. It means a welcome day off for some, while it provides others with a chance for big pay day. It’s the first Monday in the month of September. It’s Labor Day.

It provides union leaders and politicians a chance to make rambling speeches on their contributions to improving the wages and working conditions for the rest of us. Perhaps the most interesting aspect of this and every other Labor Day, is that the labors of the small business owners that actually provide the jobs that pay the wages go largely unrecognized.

The first Labor Day celebration was held back in 1882. Two New Yorker’s, Matthew Maguire, a machinist, and Peter McGuire, a carpenter, organized a parade in the streets of the city to attract attention to the plight and progress of the labor movement.

With the passage of the National Labor Relations Act in 1935, union membership grew steadily from slightly more than ten percent of the work force to thirty-five percent of the workforce by the late fifties. Since 1960 union membership has steadily declined. Today less than 20% of the workforce belongs to organized labor. Who is speaking for the other 80% on this Labor Day?

Semantics are important. Today, at parades and picnics, in proclamations and press releases, the so called “labor leaders” will be telling us what they have done for us lately. The terms “labor” and “labor leaders” are misused. Hell, I’m labor, you’re labor and the people that will be grabbing all the headlines as “labor” spokesmen represent less than one out of five of us.

Don’t get me wrong, organized labor has played an important role in the industrialization of America. The impact of which has sometimes been good, sometimes not so good. However, there is a big difference between “organized labor” and “labor”. Spokesmen for “organized labor” proclaim themselves to be representatives of the working men and women of America, when in actuality they represent less than 20% of the workforce.

I have managed both unionized and non-unionized facilities, each worked well. The decision to have organized representation is an individual one. Today, fewer and fewer individuals are making that choice in favor of unionization.

There have been many factors that have contributed to the improved conditions and opportunities for working men and women in our country since the turn of the century. It’s private industry that has created the jobs It’s the competition amongst private employers that have increased wages and improved working conditions.

Unions have incorrectly been assumed to have accounted for higher wages. Competition between independent businesses and an increasing demand for a particular skill or resource are the fundamental reasons for higher wages.

When unions do get higher wages for their members than the free market would otherwise supply, there will always be adverse consequences. There will be fewer jobs available at that wage and those higher wages will be paid at the expense of other workers. The primary motivation for employee organization is unresponsive management, not higher wages.

Higher wages and improved working conditions can only come from improved productivity, increased capital investment, and competition. Only by making a bigger pie is there more to share. It is the innovative and entrepreneurial spirit of the independent business owner that has made that pie grow. It is a result of our free and competitive economy and the efforts of small business that we celebrate the ever improving circumstances of working Americans.

Our system is not perfect. There are inequities. Progress is not made uniformly. But the steady improvement of working conditions during this century are testimony that the system works. Free enterprise, not trade unionism, has been and will continue to be the engine of progress and the worker’s prime benefactor.

The opportunity to work for ourselves and the competition amongst employers for our services are the freedoms that we should be celebrating today. To allow the autocratic leaders of a few hierarchical organizations that can claim less than one in five workers as members to dominate this day is wrong.

Labor Day is symbolic of a number of things. The holiday was initiated by the efforts of two trade unionists some ninety years ago. Substantial progress has been made in our standards of living since that time. More progress is yet to come. That progress has come and will continue to come as a result of the risks undertaken and the labor put forth by the men and women who own and operate the businesses that provide the jobs. Many of whom are probably working today.

Even though it’s your business, your labor counts too. Happy Labor Day.

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