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Why Unions are Being Formed at Companies Nationwide

An Organized Comeback

There is a union movement afoot. After decades of declining participation, more workers nationwide are organizing at a diverse range of companies including Amazon (AMZN), Apple (AAPL), and REI. Starbucks (SBUX), a company that has been lauded for pro-worker benefits, now has 209 stores that have voted to unionize.

Other companies have seen union support grow at a slower pace. Just one of Apple’s over 270 stores voted to unionize, while Google Fiber contractors have also held a singular vote that favored unionization. Even so, worker interest in organizing has spiked and more elections may be coming in the near future.

Worker Frustration

Market observers contend the movement has roots in worker frustration over stagnant wages, all while the tight labor market leaves employees feeling as though they’re in a position of strength. Worker dissatisfaction may have been further stoked by headlines of outsized profits earned by companies such as Amazon (AMZN) and Walmart (WMT).

Meanwhile, unions are offering sweeteners and protections to encourage workers to organize despite the associated dues. For example, the Workers United union set aside a $1 million safety net for Starbucks workers should wages be lost during a strike.

Trade Offs

Companies who would prefer not to deal with a unionized workforce are making their case against the movement both to employees and the National Labor Relations Board. Former CEO Howard Schultz visited several Starbucks stores for “collaborative sessions.” Apple took a different track – it bumped up its starting pay for retail employees to $22 from $20.

Amid rising labor costs, union-driven or otherwise, consumers may see product costs rise. A longer line at the barista counter is a potential eventuality due to a smaller workforce. At the same time, workers may enjoy better benefits or higher wages through collective bargaining.

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James Flippin ABOUT James Flippin James Flippin is the son of a financial advisor who grew up hearing and learning about bond yields, interest rates, the stock market, and the ins and outs of Wall Street. After stints as a licensing and business broker for Marcus and Millichap in New York City, James moved into broadcasting and became a reporter and anchor. He covered crime, politics, finance, and tech at NBC News Radio while working part-time as a producer for SiriusXM. James graduated from the University of Delaware with a bachelor’s degree in political science and economics. He's also an accomplished podcaster with over 10-years of experience.

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