Worker voice, representation, and power

A National Industrial Policy Could Strengthen a Manufacturing Resurgence Underway

Elizabeth ViviritoJune 07, 2023

As trees across the Midwest showcased their autumn colors, WorkRise Leadership Board Member Bill Dirksen and I connected to discuss unions, jobs, and the future of manufacturing across the region. As the former director of labor affairs for Ford Motor Company, Dirksen led negotiations with the United Auto Workers (UAW) for a decade and is now based in Ann Arbor, Michigan. Despite his retirement three years ago, Dirksen remains a close observer of the economy, labor markets, and the auto manufacturing industry, which is having a resurgence.

In January, the Infrastructure Investment and Jobs Act authorized the largest federal investment in public transportation in the nation’s history at $108 billion. This fall, the Creating Helpful Incentives to Produce Semiconductors (CHIPS) and Science Act announced another $50 billion toward manufacturing. As a result, Michigan is benefiting from the national attention. President Biden attended the Detroit Auto Show and test drove an electric vehicle. In October, Michigan Governor Gretchen Whitmer announced 30,000 new auto jobs in Michigan alone since taking office in 2019. Across the country, employment in auto manufacturing is recovering steadily from waning demand from 2020. Further, investment in new auto technology across the Midwest has topped $17.9 billion.

I asked Dirksen for his take on the microeconomics: what do these trends mean for auto workers? He said that “the auto industry still employs hundreds of thousands of workers and they're good, middle-class jobs. The starting rate is less than it used to be, but it is still around $18 an hour and, importantly, a path to grow to $30 an hour for workers that remain for four to eight years. . When you combine this will world-class health care benefits, it’s a great outcome for workers. And those jobs, I believe, are going to be there for a long time.”

How unions can evolve

Unions have played a crucial role in automotive job quality. Evidence has shown time and again that they help improve worker outcomes beyond just card-carrying members. Worker power is having a moment, Dirksen believes. He cites successes at union organizing at Amazon and Starbucks and campaigns like the Fight for 15, which work across sector and geography to achieve wage increases. In Germany, he points out, collective bargaining for some sectors happens at the industry level, which frees companies up from competing against one another. These examples demonstrate that there are new approaches to enhancing worker power that can be quite successful.

Despite pockets of progress, union membership has declined for decades. “Unions need to continue to evolve and improve their approach to organizing. I think their strategies need to consider how to work in partnership with worker organizations and other non-union worker advocates, who are trying to achieve similar results,” said Dirksen.

“We’re in a unique period right now, where the labor market has been strong,” he said. Worker voice could be, too.

Skilling up workers to reduce underemployment

What worries Dirksen are two key trends affecting America’s workers: inflation, which is depressing real wage growth, and underemployment. “We have a whole lot of underemployed people, people at very low wages,” he said. “It seems to me that this is a unique opportunity, a unique time, to find a way to move those lower wage [workers] up into the many open positions out there that are unfilled. It’s a missed opportunity.”

There are multiple barriers to moving the underemployed into better-paying jobs: antiquated recruitment and hiring systems; a lack of robust job matching and training and certificate programs, especially for unemployed workers; and geographic and transportation barriers. No single company, worker rights group, or municipality can solve these myriad challenges. That is one reason why this may be the right time to pursue a national industrial policy.

Setting the policy agenda: The role of a national industrial policy

The pandemic and its supply chain challenges awakened the nation to the disruptions that occur when manufacturing is offshored. Prices rise for consumers when supply chains break down.

Yet, for all the attention to the vulnerabilities of the globalized supply chains, the opportunity to create a comprehensive industrial policy hasn’t fully materialized. Dirksen said that “one of the few things that there seems to be an emerging bipartisan consensus around is that we actually do need an industrial policy where we strengthen and support industries that create and sustain jobs in our economy, number one, but also improve our national security.”

A national industrial policy could take on some of biggest challenges the manufacturing sector faces, which worker’s rights groups and the private sector can’t fix unilaterally. Such a policy could prioritize worker training for industries with chronic worker shortages. It could address current gaps in our supply chain like, for example, like automotive semiconductor chips, and help prioritize US-sourced materials, as the Inflation Reduction Act aims to do. It could also boost key industries off the ground in critical areas such as technology and manufacturing, or it could support the transition from carbon-based energy to more renewable sources.

 “I absolutely think there’s a future for US manufacturing,” said Dirksen. But cooperation between companies and unions isn’t enough if we want to improve job quality, build a robust supply chain, and address national security. It takes local and federal policy too.

Elizabeth Vivirito is a Midwestern-based writer and communications professional.

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