I’m not in a RTW state and people in my state have been arguing about it as long as I can remember. Even after I read it, I still don’t understand what it means and how it could bring wages down.
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On a stable economy, there is a bit of inflation, which for the average person and company, is simply the loss of purchase power with the same amount of nominal money. If the income is not increased, then the worker/company is able to buy less than he/she was able to in the past months/years.
Enter the union. A single worker is rarely able to convince employer to get a raise just because things are more expensive. The union, with the threat of a strike, can make it more expensive to the employer to have a strike than to simply correct the salaries for the inflation. It’s simple math: a 5-day working week have 260 working days for year at best ; paying a 2% raise is far more worthy and less trouble than a strike dropping productivity of a week to zero.
Companies dislike this dynamic because if they aren’t able to pass down the prices to the consumers, they are the ones who absorb the loss of the inflation and can have reduced profits or even operate on a loss. So companies ask for legislators for a change of legislation.
Legislators make new legislation that makes it so that workers are not forced to pay for the costs of the union, yet can still reap the benefits of union membership. Most of workers won’t pay the union fees simply because people don’t like paying fees if they can. The union now starts seeking help from other politicians, and this new dynamic means that even people who might think it’s acceptable to pay the fees might have different ideas from the politicians who are in close contact with the unions and also refuse to pay the fees.
As a result of this, union membership numbers plummet and the union loses negotiating power. Because of this loss, the union is barely able to do anything worthy for its members, and workers’ trust in the unions decrease.
As unions collapse or hold minimum power, wages are kept the same despite inflation over the years and this leads to more people struggling financially. The ones who are poor enter a category of despite being employed, requiring welfare programs. The ones who are middle class enter a situation where they are unable to afford a mortgage for a house or to acquire assets.
As a result of this struggling and inability to buy assets, middle class couples become financially unable to have children and fertility rate plummets to a level below maintenance. This would create a labor shortage and the corresponding increase of wages as merely a result of supply and demand mechanisms. As years pass, new companies are formed and they have another viewpoint. By promoting diversity in public policies and as company policies, they are able to hire immigrants across all levels of education and qualification, by paying a much lower wage than they would need to if the labor shortage actually happened.
**TL;DR**: Company asks for right to work laws to make unions weak, wages are kept same despite inflation, fertility rate drops, decades pass and the threat of labor shortage is real, companies avoid it by asking for immigration laws to change and to successfully hire immigrants in order to keep paying workers a much lower wage.
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