Michigan Poorer Than Average Of Right-to-Work States

Michigan State University Professor Charles Ballard told an audience at the Detroit Economic Club recently that per-capita earnings in right-to-work states are about $5,000 less than in non-right-to-work states.

What he didn't say was that Michigan's per-capita earnings as a non-right-to-work state were below right-to-work states in 2011.

The per-capita income in non-right-to-work states was $43,666 in 2011. The per-capita income in the 25 right-to-work states was $38,308. Michigan’s was $36,264.

In an email, Ballard said that right-to-work didn’t necessarily cause a state to have low income.

“My point is that, since per-capita incomes in RTW states are substantially less than per-capita incomes in non-RTW states, it is very difficult to make a serious case that RTW is the path to a more prosperous economy,” Ballard said. “It doesn’t necessarily say that RTW is the path to poverty, but it does point us toward other explanations.”

Mackinac Center for Public Policy Fiscal Analyst James Hohman said that it would be an improvement for the state if Michigan's per capita income reached the average of right-to-work states.

"Michigan went through a decade-long recession and is just now experiencing a sustained recovery," Hohman said. "Just how fast and how much the state recovers depends on the rules the state enacts. Michigan policymakers have made a lot of improvements to those rules, with right-to-work as the capstone."

Those saying that right-to-work per-capita income is higher than non-right-to-work states often don't take into consideration the trends when compared to forced unionization states. Those poorer states were earning less even before right-to-work became an option. In recent decades, right-to-work states have grown faster in population, jobs and income when compared to forced unionization states.

The first states to give workers the freedom to choose whether they want to pay to be in a union as a condition of employment did so in 1947.

States that adopted right-to-work laws didn't become poor because of the law. Most were struggling already. For example, Texas' per capita income was on average $540 from 1929 to 1946, which at that time put it 36 percent below the average per capita income of the states that became non-right-to-work states. In 2011, Texas’ per capita income was $40,147 and was just 8 percent below the per capita income of non-right-to-work states.