Labor in Industrial Society

• Date: 01 March 1951
• DOI: 10.1177/000271625127400121
• Published date: 01 March 1951
• Author: Peter F. Drucker
• Subject Matter: Articles

145

Labor

in

Industrial

Society

By

PETER

F.

DRUCKER

N EVER

before,

it

seems,

has

organ-

ized

labor

been

as

strong,

as

powerful,

and

as

accepted,

in

this

coun-

try,

as

today.

Yet

the

American

labor

movement

faces

its

most

serious

crisis.

It

is

a

crisis

of

success,

not

of

failure-

but

that

may

make

it

all

the

more

se-

vere.

Our

union

leaders

still

live

in

the

days

when

they

had

to

fight

for

recog-

nition

if

not

for

existence

But

the

problems

they

really

face

are

those

of

labor’s

power

and

responsibility

as

a

ruling

group

in

industrial

society.

True

to

the

traditions

of

this

coun-

try-and

they

are

good

traditions,

in

this

case

at

least-the

problems

will

not

be

solved

one

the

theoretical

or

abstract

level,

but

pragmatically

and

case

by

case. But

it

is

quite

clear

what

the

areas

are

in

which

the

decisions

will

have

to

be

found.

They

are:

(1)

wage

policy,

(2)

the

&dquo;right

to

strike,&dquo;

(3)

union

control

over

the

citizen’s

access

to

a

livelihood,

and

(4)

internal

union

organization.

A

&dquo;RATIONAL&dquo;

WAGE

POLICY?

It

is

no

exaggeration

to

say

that

today

practically

the

entire

wage

and

salary

structure

of

the

United

States

is

deter-

mined

by

union-negotiated

wages.

Even

those

companies

which

are

not

union-

ized

set

their

wages

on

the

basis

of

the

contract

signed

by

their

unionized

neigh-

bors.

And

even

those

industries

which

are

not

unionized-for

instance

the

white

collar

employers-set

their

wage

and

salary

rates

largely

in

accordance

with

the

wages

obtained

by

the

strong

unions

in

the

community.

An

inquiry

conducted

by

the

author

among

insur-

ance

companies,

for

example,

showed

that

all

of

them

base

their

salary

rates

on

the

union

contracts

in

the

industry,

even

though

only

a

few

are

unionized.

At

Thompson

Products

in

Cleveland

-the

largest

nonunionized

company

in

the

automotive

industry-the

workers

themselves

clearly

realize

what

is

going

on.

&dquo;As

long

as

we

manage

to

defeat

the

CIO’s

attempt

to

unionize

this

place

-but

not

by

too

lavish

a

margin&dquo;-

an

old

Thompson

Products

worker

once

told

me,

&dquo;we

can

be

sure

of

getting

better

than

union

rates

without

having

to

pay

dues

to

the

union.&dquo;

In

fact,

this

total

dependence

of

the

wage

and

salary

structure

on

union

wage

rates

may

be

one

of

the

greatest

obstacles

to

the

expansion

of

unionism.

In

the

textile

industry,

for

instance,

where

only

one-third

of

the

workers

are

organized

in

the

Textile

Workers

Union

(CIO),

the

other

two-thirds

can

be

fairly

certain

of

receiving

union

wage

rates

or

better;

and

I

have

heard

re-

peatedly

from

workers

in

the

industry

that

under

these

conditions

they

see

no

reason

for

joining

a

union.

At

the

same

time,

wages

and

salaries

take

two-thirds

of

the

total

national

in-

come-that

is

about

as

much

as

they

can

possibly

take.

Of

the

remaining

33

per

cent

or

so,

10

per

cent

goes

to

the

farmers;

the

rest

is

split

between

the

small

businessmen

and

professionals,

the

payments

on

interest

and

bank

and

funded

debts,

the

host

of

transfer

pay-

ments,

and

profits,

with

each

category

probably

as

low

as

it

can

go.

And

this

is

the

distribution

during

a

boom.

Dur-

ing

a

depression,

the

shares

of

the

non-

wage

recipients

would

drop

very

sharply,

1

See

C.

Wright

Mills,

The

New Men

of

Power,

New

York,

1948.