What Labor Unions can Teach us About Social Capital

Labor Unions have always been a powerful bargaining tool for the working class, but why does it feel they are losing steam?”

By Zoe Hall

Two weeks ago, I wrote an article about social capital and the potential role it could play in the success of the United States’ healthcare system. However, it left a lot of aspects of social capital to be explained. One of the most glaring question left untouched, is that if social capital is such a useful tool for public policy, why isn’t it more widely and heavily implemented? To answer that question, let’s take a look at the most distinct attempt at organizing social capital as a resource in our economy: the history of labor unions in the United States.


The Origins of the Labor Union

     The fundamentals of a labor union sprung from the laborers’ needs for additional support and leverage in any dispute with their employer. Whether that be a protection against their employer hiring cheaper labor or a need for adequate legal representation for human rights complaints, labor unions provided power in numbers to the little guy. Labor unions’ are often recognized for their essential role in establishing a minimum wage, overtime, and child labor laws. But there’s way more to them than that.

     In unionized workplaces, when an injustice from upper management occurs against an employee, the employee is not dealing with their situation alone: they have a union representative and all the individuals members of the union to help them stand up to their employer or big corporations. In order to work in certain industries, unions made it a requirement to mobilize and protest together against the exploitation of labor. This arose out of a dire need for substantial labor organizing. For example, before labor unions existed, there was the Railroad Strike of 1877. Although the strike was unorganized in nature and execution, all of America felt the repercussions of wage cutbacks for railroad workers in West Virginia, as railroad workers across the nation went on strike to protest the exploitation of their fellow laborers. Soon other minimum wage-earners began to strike in sympathy in what is now described as a ‘general labor strike.’ Without proper organization, though, what was the goal of this strike? What did it really accomplish?

     The Railroad Strike of 1877 focused the nation’s moral compass on labor rights. The mistreatment of the labor class suddenly became an aspect of the country that needed a solution, quickly. Essentially, these unorganized protests provided the social momentum that was necessary for the foundation of labor unions. There was a lot of newfound energy in the country at the laborer’s disposal to gain rights and establish proper legal precedents. Labor rights became a topic of discussion in communities across the country, and it was now socially acceptable to voice complaints about employer mistreatment at work. This organically created an abundance of new social capital for the labor class to come up with a strategy to progress the power and stature of their class in the work force.

     The most dominant labor union in American history is the American Federation of Labor, founded in 1886 by Samuel Gompers, along with Congress of Industrial Organization, its counterpart in history until they merged in 1955 to form the AFL-CIO. There exist different types of unions unique to their industries, but until 2005 all of them operated under the leadership of the AFL-CIO. Then, in 2005, coupled with the steady decline in unionization of the labor force, a group of three powerful unions branched off to form their own leadership called the Change to Win Organizing Center. They were unhappy with how things were being run and, in a sense, they unionized against them.


The Big Union Split

     The three unions that formed the CtW did so because they disagreed with the model of the union in the workplace under the AFL-CIO. In unionization, there have been two main models of unionism: the service model and the organizational model. It is said that the service model arose as the main model of the AFL-CIO after World War II out of its convenience — it functions quite a lot like another mechanism in the workplace. Under the service model, unions became much more like “insurance policies” filled with lots of paperwork and bureaucracy. Unions turned their focus to contracts, handling grievances as a procedure rather than a personalized experience, and arbitrated disputes ending in settlements rather than any mobilizing or force for change. The piling on of paperwork and lack of any real social engagement steadily drained labor unions of a lot of the social capital that inspired so many people to be a part of them in the first place. That’s where the CtW came in.

     Under the CtW, the union model is organizational. This model focuses a lot more on engaging new members to take part in leadership positions of the unions. It taps into class consciousness and tries to gets its members to embrace the organization at a really personal level. The model creates membership by seeking out individuals who have similar goals aligned with the union and harnesses the individual’s energy into the network the union has already created. By doing so, this creates a social networking experience around joining and participating in the union. It focuses less on establishing norms and regulations and instead seeks to engage the community by tapping into their personal feelings, either of exploitation and rage towards their employer, or ambition for improvements within the working class. This is an excellent example of the way that labor unions have historically been able to harness social capital into, essentially, ‘funding’ their institution.

     The Women’s March on Washington is a large scale result from organizers that would be involved in an ‘organizational’ union. For the most part this type of union excels at discovering the various ways different groups of workers could link together their social capital. However, this model is often very reliant on reaction. It depends on its members undergoing constant duress to mobilize them and stay active. This is an exhaustive state of existence that most regular people would not opt in to. Unfortunately, lack of agitation leads to stagnation within labor organizing. It was once said that, “social capital is a perishable good. It atrophies unless it is used.” The problem for labor unions then, and the lessons we must learn from them, is how to keep the social capital from atrophy.


What does this means for organized social capital?

     These days, labor unions are considered inadequate by their members and their opposition alike. Alabama, Arizona, Arkansas, Kansas, Florida, Georgia, Idaho, Indiana, Iowa, Kentucky, Louisiana, Michigan, Mississippi, Missouri, Nebraska, Nevada, North Carolina, North Dakota, Oklahoma, South Carolina, South Dakota, Tennessee, Texas, Utah, Virginia, West Virginia, Wisconsin, and Wyoming are all the states in the U.S. that have passed ‘Right to Work’ legislation which enables employers to hire laborers on an individual basis, whether or not they are in a union. These are all pretty conservative states that have historically contained a lot of rural, working class households who benefit from the strengthening of the labor class. Why did they want this legislation passed?

     For starters, a lot of labor industries are a union boys-club. Access into industries ranging from coal mining to teaching has been barred by anyone outside the union. This practice, as time goes on, leaves a lot of newcomers in the workforce alienated and unrepresented. What once turned institutionalizing social capital into a good and powerful tool that advanced an exploited sector of our population is now engulfed in a lot of the same politics and agenda it was meant to keep in check. The ‘Right to Work’ legislation sells itself as “affirming the right of every American to work for a living without being compelled to belong to a union.” Although labor unions used to symbolize the empowerment of the working class, over time they have lost this shiny branding tool. The feelings towards them are more nuanced than that: it can be a polarizing thing within the working class to disclose your pro or anti union ties. Labor unions used to be a tool for building social capital, but now, much like the health care problem, they are just as useful a tool in its destruction.


Institutionalizing the Social Capital of Today

     In an economics metaphor, think of it this way: perhaps labor unions have maximized and used up all the social capital that existed between laborers. The abundance in wealth of social capital that labor unions had in 1877 has been depleting ever since they began its consumption. Instead of looking at labor unions as a failed strategy of implementing social capital as a real good in our economy, we could view them as a rough model of the depreciation rate of social capital. That does not necessarily mean that social capital will definitely depreciate as time goes on, it merely means we must take into account that, like any physical capital, social capital must be maintained and updated to suit the current needs of its beneficiaries..

     We must not take the lessons of social capital in labor unions lightly. In a lot of ways, creation of labor unions came from a response to a cycle of the economy that is closely resembled in today’s world, with the backbone of the economy very disenchanted and upset with the way things have been run, and a resurgence in a willingness to band together (and therefore, use social capital) to do something about it. We must learn from labor unions how best to organize and implement this resurgence of social capital to benefit those of us in the economy who may only have access to this capital in times like these in a way that better preserves it for the future.



Moore Johnson, S. (1989). The Changing Idea of a Teacher’s Union by Charles Taylor Kerchner and Douglas E. Mitchell. In Education Evaluation and Policy Analysis (Vol. 11 No.4, pp. 433-435). New York, NY: American Educational Research Association.

Jarley, P. (2005). Unions as Social Capital: Renewal through a Return to the Logic of Mutual Aid? [Electronic version]. Labor Studies Journal, 29(4), 1-26.

Putnam, R. D. (1995, December). Tuning In, Tuning Out: The Strange Disappearance of Social Capital in America. Ithiel de Sola Pool Award and Lectureship.

Franklin, S. (2010, August 26). A Brief History of Labor Unsolidarity: AFL-CIO and Change to Win. In These Times. Retrieved February 24, 2017.
Image: Jacobo, J. (2016, May 27). Verizon Reaches 4-Year Deal With Striking Labor Unions. Retrieved from ABC News: http://abcnews.go.com/US/verizon-strikes-year-deal-labor-unions/story?id=39433739