Worker Replacement Costs and Unionization

Abstract

The embattled state of U.S. labor has generated a voluminous body of research on the processes of deunionization contributing to its decline. Revisiting the less researched topic of unionization, this study explores the social conditions facilitating union growth during the labor movement’s formative years. Focusing on the first decade of the twentieth century—in many respects for labor, a period not unlike the present—I seek to explain the pattern of organizing success and failure across industries and occupations. I find that the most organized settings occurred where workers had greater disruptive capacities due to the high cost of being replaced during work stoppages. The highest replacement costs were associated with three conditions: scarcity of skilled labor, geographically isolated worksites that raised the cost of importing strikebreakers, and time-sensitive tasks that rendered replacement workers economically impractical. Workplaces that had at least one of these conditions formed the backbone of the early U.S. labor movement. The conclusion considers the impact of declining replacement costs on current challenges facing U.S. labor.