THAT FIFTIES NOSTALGIA, AGAIN. Not for tail fins or ducktail haircuts, rather for unionized concentrated industries in a world rebuilding from war. It's a long-time theme at Cold Spring Shops, and news of the end of Local 1111, United Electrical, Radio, and Machine Workers, once representing thousands of Allen-Bradley production workers, latterly representing 130 plant service workers, once again invokes that old industrial organization.

It was in the decades after World War II that a predictable pattern developed. Local 1111 and Allen-Bradley's management sat down every three years to hammer out a contract, meeting dozens of times in a typical cycle. Strikes were infrequent but serious, and the general movement was upward: in wages, benefits and working conditions. Adding 15 cents an hour and a week's vacation in one round of negotiations, 30 cents and paid health insurance in the next, the union pushed wages and benefits to levels unimagined in the '20s, and salaried office workers always received what management called "a corresponding increase."

The company was quite willing to reward its employees for their labor. Demand for Allen-Bradley's industrial controls went through the roof after World War II, and by 1968 the payroll had swelled to nearly 7,000 workers, most of them union members. The 2nd St. plant was filled with people 24 hours a day, creating some memorable traffic jams at shift changes. Factories elsewhere in Milwaukee and across the country were experiencing the same prosperity. For many years, in fact, Allen-Bradley's contracts were patterned after those negotiated at General Electric, a much larger competitor.

General Electric and Allen Bradley and the other major electrical equipment manufacturers also patterned their prices after each other, guided by the phases of the moon, and organized at Dirty Helen's bar. When analyses of the rise and eclipse of an industrial middle class become reflective, it's useful to think about the distorting effect of unionization and concentration in closed markets.

The rising tide lifted an entire fleet of blue-collar boats. Simply put,
America's working class became its middle class in a single generation. Factory workers without even a high school diploma could afford houses, cars, cabins and college tuition for their children. It was economic prosperity and the unyielding pressure of labor unions that made it all possible.

That pressure, of course, made American workers among the highest-paid in the world, and a countertrend eventually asserted itself. As global competition intensified, Allen-Bradley, like all of its peers, began to cut costs by shifting work to lower-wage locales in rural Wisconsin, the southern United States, Mexico and ultimately Asia.

The United States's comparative advantage has long been in knowledge-intensive, high-technology goods, not routine production, and profits have a way of attracting entry.

The union itself was unusual. Them and Us: struggles of a rank-and-file union tells its early story. At one time, union by-laws strictly limited the pay of union officials (I believe to a multiple less than five of the highest pay grade in a contract) such that one could not achieve the lifestyle of a capitalist by claiming to represent the workers.


David Foster said...

A few thoughts...

1)A large middle-class population was made possible largely by *economic productivity*. It would not have mattered how aggressive unions had been, were it not for tremendous increases in manufacturing productivity--some of it equipment-based, some of it process-design based.

2)OTOH, there is a feedback loop: higher labor costs incent more attention to productivity improvements. (I recently read an economic history of the spinning jenny, asserting that the reason this technology was adopted in England much sooner than France was basically the ratio of labor costs to capital costs.)

3)There is intellectual effort involved in making things, not only in designing them. "Routine production" can, when done right, involve a very high level of intelligence and creativity.

Stephen Karlson said...

With respect to points 1 and 2, exactly! (There were hints of the mass-middle-class USA during the 1890s with the first streetcar suburbs and in the 1920s with the first automotive suburbs). And Friedrich Engels once complained about England, that most bourgeois of nations, developing a bourgeois proletariat. Your point 3 is the short form of my occasional Blue Collar Aristocrat references.