In 1887, Michael
Cudahy, with the backing of Philip Danforth
Armour, started the Armour-Cudahy
packing plant in Omaha, Nebraska.
Cudahy Packing Company was created in
1890 when Cudahy bought Armour's interest. The company added branches
across the country, including a cleaning products plant at East Chicago,
Indiana, built in 1909. In 1911, the company's headquarters were relocated
from Omaha to Chicago
https://en.wikipedia.org/wiki/Cudahy_Packing_Company
By 1922, Cudahy Packing Company was one of the largest packing houses in the United States with over $200 million in annual sales and 13,000 employees around the country. and operations in South Omaha, Kansas City, Saint Joseph, Sioux City, Wichita, Memphis, East Chicago, Salt Lake City, and Los Angeles, as well as distribution operations in 97 cities. The business was hit by the Great Depression, but the company still employed about 1,000 Chicago-area residents during the mid-1930s.
Following World War II,
it moved its headquarters in 1956 to Phoenix, where it took the name Cudahy
Company. In 1957, the company was one of 500 companies listed in the
first S&P 500.
One of the packing plants
owned by Cudahy was one in St. Paul Park, Minnesota, a short drive from my dad’s
home town of Hastings, Minnesota.
During WWII, farmers were exempt from military service because their produce, especially hemp, was vital to the war effort. Shortly after war broke out, dad left the running of the Brennan farm to his brother Clem, and he joined the Army.
When the war ended, dad
returned to the farm, but after marrying my mother in the fall of 1946, he
needed more income, so he went to work for Cudahy.
In 1954, the plant
closed.
Dad now had a 6-year-old
son, a 4-year-old daughter, and a new mortgage, so he needed to find a way to
generate some income – in a hurry. He started working the night shift at Zinsmaster
Baking Company, but knew that he needed a better job for the long term – so he
took the test to become a mail carrier.
He started working for the
Postal Service in 1955 (the peak year for union membership), and stayed there
until his retirement in 1976.
In the 1960s, the percentage of workers who were members of unions was falling from the peak achieved in the 1940s and 1950s. While 31.5% of workers were union members in 1950 and 33.2% were in unions in 1955, that percentage fell to 31.4% in 1960, 28.4% in 1965 and 27.3% in 1970. Union participation has continued to fall since then. Thus, although unions have had an important impact on the American economy, an increasingly smaller percentage of American workers have been part of this impact since the late 1950s.
When the 1960s began, the world of American labor
was still adjusting to the 1955 merger of the American Federation of Labor
(AFL) with the Congress of Industrial Organizations (CIO). In 1968, the United
Automobile Workers (UAW) withdrew from the AFL-CIO and, in 1969, merged with
Jimmy Hoffa's International Brotherhood of Teamsters
One of the exceptions to
a diminished union presence is the United Postal Service, which now has seven
separate unions.
https://facts.usps.com/collective-bargaining-agreements/
Today, only a little more than 10% of the American work force belong to unions, but the trend is starting to shift in the other direction, for two reasons:
(1)
Record corporate profits
(2)
Unfavorable working conditions.
https://en.wikipedia.org/wiki/Labor_unions_in_the_United_States
U.S. corporations pulled in more profits in the three months ended in September of 2021 than ever before. Not just in dollar terms—something that happens frequently—but as a share of the economy. According to initial estimates from the U.S. Bureau of Economic Analysis, third-quarter after-tax corporate profits from current production amounted to 11% of gross domestic product. The previous record of 10.7% was set in the second quarter of 2021; before that the all-time high was 10.6%, in the first quarter of 2012.
Those record profits, however, have not been of much help to
the people who work for those corporations.
Business has boomed
during the pandemic for Kroger, the biggest supermarket chain in the United
States and the fourth-largest employer in the Fortune 500. It owns more than
2,700 locations, and its brands include Harris Teeter, Fred Meyer, Ralphs,
Smith’s, Pick ’n Save and even Murray’s Cheese in New York City. The company,
which is based in Cincinnati, said in December
that it was expecting sales growth of at least 13.7 percent over two years.
The company’s stock has risen about 36 percent over the past year
But that success has not trickled down to its vast work force of nearly 500,000 employees, a number of whom have reported being homeless, receiving government food stamps or relying on food banks to feed their families. A brief strike in Colorado last month by workers, represented by the United Food and Commercial Workers Union, at dozens of Kroger-owned King Soopers locations brought renewed scrutiny to the issues of pay and working conditions for grocery workers, who have been on the front lines throughout the pandemic.
During the pandemic, grocery store workers have been recognized as essential to keeping society going, but they have also faced health risks. At least 50,600 grocery workers around the country have been infected with or exposed to the coronavirus, and at least 213 have died from the virus, according to the United Food and Commercial Workers International Union.
Kroger has one of the country’s starkest gaps between a chief executive’s compensation and that of the median employee. Rodney McMullen, Kroger’s chief executive since 2014, earned $22.4 million in 2020, while the median employee earned $24,617 — a ratio of 909 to 1. The average C.E.O.-to-worker pay ratio in the S&P 500 is 299 to 1, with grocery chains like Costco (193 to 1) and Publix (153 to 1) lower than that.
These disparities have fomented outrage among employees, who are also dealing with issues like fights over masks and theft and violence in stores.
I’m a big fan of Starbucks. Although it’s rare that I’ll spend $4 to buy a tall latte at one of the company stores, it’s the only coffee brand that I buy at the store.
The company’s found, Howard Schultz, has written three books,
and I have read all of them.
In terms of employee benefits, Starbucks is more generous than
many employers.
A company health plan, a stock option program,
free online college through Arizona State University, online mental health
counseling.
If you dig a little deeper, though, you’ll discover that employees
needed more than that, which is why the employees in Buffalo, New York just
formed a union.
The Washington Post article posted below is lengthy, but it provides a lot of the answers that help us understand today’s labor market.
https://www.washingtonpost.com/nation/2022/02/12/rhodes-scholar-barista-fight-unionize-starbucks/
In spite of the success in Buffalo, other cities are not as fortunate.
On Martin Luther King Jr. Day, Starbucks employees in Memphis, TN announced their campaign to unionize in the same city where King was murdered while fighting for the rights of sanitation workers to unionize.
Starbucks responded by firing every member of the Memphis organizing team.The seed of the labor movement was the Haymarket Riots in
Chicago in 1886 – which eventually led to Labor Day celebrations throughout the
world. Violence was common in the early days of unions.
The first successful strike was in Flint, Michigan in 1937.
Corporate goons discouraged the union from forming, but the
workers eventually prevailed.
https://guides.loc.gov/this-month-in-business-history/february/flint-michigan-sit-down-strike
By the late 1970’s, unions had actually acquired too much power,
which made corporations, especially auto manufacturers, unable to compete against
foreign corporations, which is why Honda opened a non-union plan in Marysville,
Ohio in 1982.
When I started my first job (at Montgomery Ward) in 1964, I
was required to pay union dues. However, every single job that I have had since
then has been a non-union job.
Unions, though, have been a great benefit to me in my
lifetime.
In the 1950’s, a guy without a college education, and a union
card, could make enough money as a sole provider to pay for a mortgage and
provide a comfortable living for his family.
Recent attempts to form a union have not always been
successful, as evidenced by attempts to unionize auto plants in Tennessee (VW
and Nissan) but the trend is clear.
Unions are here to stay – and they will continue to grow.
Dad would be pleased.
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