Right-To-Work Legislation and the Economic Position of Black Workers

Abstract

Recent empirical analysis of state right-to-work legislation indicates that a negative wage effect may result as a consequence of banning union shop contracts. It has been previously shown that industrial unionism tends to improve the relative wage position of black workers. Thus, it is hypothesized that if state right-to-work laws weaken the economic power of unions to raise wages, black workers will experience a disproportionate decline in their relative wage position. Black workers in right-to-work states would therefore experience a reduction in their relative economic position unless a strong positive relative employment effect occurs in response to the decline in wages. Using a cross-sectional regression model this article examines the relative employment effect due to right-to-work legislation. The results indicate that black workers experience a statistically significant decline in their relative employment rate within right-to-work states. When this finding is coupled with the hypothesized negative wage effect, it is concluded that right-to-work legislation results in a worsening of the net economic position of black workers.