“Union busting is illegal, but consequences are inconsequential.” That’s how New York Times columnist Megan Stack described a reality now thrown over the U.S. manufacturing boom: billions of dollars flow into new factories and supply chains shift towards the home nation, but legal and technological bulwarks shielding labour relations are being strained as never before. The mix of right-to-work laws, protectionist tariffs, automation, and re-surfacing union organizing is remaking the very makeup of American manufacturing.
The last three years have witnessed America’s best effort at manufacturing revival pushed by federal subsidies, tariffs, and a desperate need for robust supply chains. Private fixed investment in manufacturing rose to $799.2 billion in 2023, a 2.5-fold growth from 2021, with $430 billion created through legislation such as the CHIPS Act and Inflation Reduction Act, states Deloitte’s analysis of supply chain restructuring. But this has not spilled over into anything similar in the way of union density or wage growth for factory workers.
American union membership is 9.9 percent as of 2024, down by half since 1983, despite public opinion in favor of unions reaching its highest level since the 1960s. It is not for lack of worker enthusiasm 60 million Americans would unionize if they were able, recent research discovers—but because, as the Economic Policy Institute characterizes it, “disastrously weak labor laws and ferocious corporate opposition to worker organizing” (EPI report on corporate union busting).
Among the primary fault lines, one splits the 26 right-to-work states, located mostly in the South, where the new manufacturing investment is most dense. The laws, facilitated by the Taft-Hartley Act of 1947, prohibit requiring union dues as a condition of employment. Although proponents argue they are defending worker choice, research by the National Bureau of Economic Research concludes that right-to-work laws are “associated with a drop of about 4 percentage points in unionization rates five years after adoption, as well as a wage drop of about 1 percent.” In extremely unionized sectors, the wage drop is more than 4 percent (NBER Digest). The impact is especially acute in mass-production industries like motor vehicle manufacture, where, the Economic Policy Institute’s Chandra Childers has found, job quality overall is worse and so not just that wages are lower, but the weight that the purchasing power of those wages are declining over time.
It has been fertile ground for anti-unionism by business. At Amazon, Starbucks, and Trader Joe’s, the playbook is both lean and mean. The Economic Policy Institute tracks how these companies combined spend tens of millions of dollars every year on “union avoidance” consultants, use predictive analytics and spying to find organizing, and use legal appeals to sidetrack or stop collective bargaining. As Harvard labor law professor Benjamin Sachs was quoted in The Guardian’s investigation, “What we have is new economy companies using the old, anti-union playbook on a national scale and in a way that people are paying attention to“ and the result: even as there have been historic union victories, such as at Amazon’s Staten Island warehouse in 2022, the workers still don’t have a first contract over two and a half years later.
The technological landscape facilitates these forces. The 13 million strong American manufacturing base confronts the twin challenge of talent shortage as experienced factory workers retire along with a ceiling on productivity after decades of progress from offshoring and automation. The next in line, industry insiders contend, will need to come from artificial intelligence-driven enterprise automation and Industry 4.0 robots. According to Infor’s estimates, generative AI could add up to 3.4 percentage points annually to productivity growth and transform everything from predictive maintenance to supply chain optimization.
But as Kristen Maxwell, in her Medium essay on reshoring in the age of AI, puts it, it’s more complicated than ‘let’s make stuff here again,’ especially in a world increasingly run by AI, automation, and robots. The concern is the manufacturing renaissance creates more capital investment than secure, well-paying jobs, particularly with automation subtracting the cost of labor from the equation of total cost. For labor economists and policymakers, the issue is less the quantity of jobs being created and more the type of jobs and who gets to write their own terms. Additive manufacturing, or 3D printing, is both a test case for the promise and for the challenge.
The industry expanded 20 percent in 2023 and is projected to rise an additional 22.7 percent in 2024, to $7.5 billion alone within the United States (Forbes on 3D printing). The technology facilitates mass customization, quick prototyping, and quick diversion of production against supply chain interruptions. As the White House Council of Economic Advisers also adds, “Additive manufacturing could also make the U.S. economy less dependent on inputs from abroad,” with reductions in material costs and energy consumption of up to 90 percent and 50 percent, respectively (White House CEA report). Yet the smaller and medium-sized manufacturers do not typically have the financial resources, technological expertise, or unambiguous demand signals at hand to invest in such new technology, further widening the productivity difference between them and major companies. Supply chain resilience is a heightened strategic issue.
Companies are diversifying supply bases, putting real-time surveillance into place with AI and IoT, and utilizing public-private partnerships to establish domestic capacity (NIST on supply chain resilience). The Manufacturing Extension Partnership, for instance, networks small manufacturers with new technology and suppliers and enables them to ride out disruptions and gain access to advanced manufacturing techniques. Despite all these changes, there is still the underlying tension: America is going through a new manufacturing renaissance without the accompanying increase in union influence or wage increases.
As Mackinac Center for Public Policy’s James Hohman told Newsweek, “This means that the unions are not looked at as an asset to improve production; they are looked at as an extra cost and extra liability.” The adversarial model of labor relations, coupled with right-to-work legislation and business opposition, has put many workers organizing under the shadow of legal and economic uncertainty. For factory workers, the way ahead is contradiction. America can lead next-gen manufacturing, AI, and supply chain resilience, but the social compact that makes those advances possible is unraveling. The stakes are economic, but also institutional: whether the new era of American manufacturing will be one of widely distributed prosperity, or simply further cement capital and tech over work.
