Newspaper article St Louis Post-Dispatch (MO)

Fall in Wages Parallels Decline in Labor Unions

Newspaper article St Louis Post-Dispatch (MO)

Fall in Wages Parallels Decline in Labor Unions

Article excerpt

Joann Henry worked at Dixie-Narco Corp.'s plant in Ranson for more than 10 years, building vending machines and earning as much as $11.45 an hour with "wonderful health insurance and all kinds of benefits."

Today, she works 33 hours a week as a liquor store clerk - for $5.50 an hour. Period.

In 1991, Dixie-Narco closed its West Virginia plant and moved to Williston, S.C., where wages averaged $6 an hour less.

The move mirrors what is happening in industry after industry. Economists and labor leaders note that the decline in organized labor has roughly paralleled the decline in working people's wages.

"Today, both spouses are working in a family and, between the two of them, they still can't bring home what one good job paid back in the 1970s," said George Becker, president of the United Steelworkers of America. "It seems like we're in a race to the bottom. And, damn it, somebody has to do something."

To Becker, in office only a year, new leadership is needed, especially at the top of the AFL-CIO, an organization of unions representing 13.3 million members in the United States. In October, the federation will choose its officers from two slates of candidates in a confrontation between its old guard and its young turks.

It is the federation's first contested election since 1894, and the first open leadership split since 1935, when United Mine Workers President John L. Lewis threw a punch at Carpenters Union President William L. Hutcheson. That fistfight led to a new direction for organized labor, away from the exclusiveness of craft-based unions, which tried to limit membership in the craft, to all-inclusive industrial unions.

"We need inspiring leaders who can create a sense of excitement, who can tell working people, `There's somebody here who will speak for you, believe in you, and take your struggle as their own,' " Becker said.

At 62, Henry doesn't expect she will ever have another job like the one at Dixie-Narco, and her life now reflects that.

She gave her new car and $4,000 worth of furniture to her children, who took over the payments. Now, she drives a 1977 Buick.

"It runs," she said, "and it's paid for."

Paul Sprenger, a Washington lawyer who represented the Dixie-Narco employees in a class-action lawsuit against parent Maytag Corp., said the plant was moved for only one reason: lower wages.

In heavily organized West Virginia, Dixie-Narco's wages averaged $13 an hour, even without a union. In largely nonunion South Carolina, the company could get comparable workers for less than half that.

Sprenger said Maytag, based in Newton, Iowa, does not need the money. It had net sales of $3.3 billion, with a gross profit of $876 million in 1994.

The suit by Dixie-Narco's 700 former West Virginia workers accused Maytag of fraud and breach of contract for the company's long insistence that it had no plans to move.

Four days after the start of trial, Maytag agreed to settle the suit for $16.5 million. The settlement included a statement by Maytag that it conceded no wrong-doing. The company said the move was an "economic necessity."

"We started out thinking we would use both facilities," spokesman Tom Schwartz said. "But in 1988 to 1991, the soft drink business went into a tailspin. The vending machine market was much weaker, and we had to match our production to the size of the market.

"We did what we could to keep our employees informed in a responsible way. The closing wasn't something we desired to have happen, but it was an economic necessity because of business conditions."

The company settled, Schwartz said, to avoid a lengthy trial in what he called "a hostile environment" in the Jefferson County courthouse, located just a quarter-mile from the closed Dixie-Narco plant. …

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