Thursday, September 8, 2022

Not So Fast

RealClearPolicy has an article claiming workers prefer to live in right-to-work states, are proving it by moving there. Hmmm, not so fast. Workers prefer to have work, and right-to-work states are where the jobs are.

What I know for sure, from my years as a business school prof, is that companies prefer to operate in right-to-work states. They prefer not having an adversarial relationship with their workforce. When the employers move from forced-unionization states to right-to-work states, we shouldn’t be surprised when the workers move there to (a) stay employed, or (b) seek employment. 

Ask yourself, which makes more sense? Stay in your forced-unionization state while the jobs and the firms which offer them move away? Or go where the work is, which is likely to be in a right-to-work state? And if the workers won’t move, held back by family ties and “ties to place,” their children will and do move to where the work is.

A century ago most of the manufacturing happened in the Northeast and what is now called the Rust Belt. But southern states were, for a variety of reasons, inhospitable to unionization. After World War II companies began to move there or expand there and now much of our manufacturing happens in the non-union Southeast. And people have followed them there.

I’d argue that firms like to move to right-to-work states and workers like to move to low taxation states. Places like TX, FL, NV, SD and my state of WY manage to be both. 

Much of the nation’s warehousing and distribution has relocated to Nevada where the tax laws especially favor such endeavors, desert land for gigantic warehouse-and-truck yards is inexpensive and winter weather isn’t a huge hassle.