By Debi Durham, ICA Chair and President, Siouxland Chamber of Commerce and Robin Anderson, ICA Past Chair and Executive Director, Mason City Area Chamber of Commerce
Once again, the so-called “Fair Share” legislation is a hot topic of discussion at the Iowa General Assembly. By definition, Right to Work laws are state statutes that prohibit unions and employers from requiring union membership or payment of dues or fees as a condition of employment, either before or after hiring. The current “Fair Share” proposal in the Iowa Legislature would require about 18,000 state employees who are not currently union members to pay union fees.
Proponents of “Fair Share” maintain that Iowa’s Right to Work status would not be jeopardized because the proposed legislation applies only to state public employees. However, research indicates that the international economic development community would no longer consider Iowa a Right to Work state if this legislation is enacted.
It is important to understand what happens when companies seek to relocate to or expand in a Right to Work state. And it is important for our legislators to know the actual impact this legislation will have on future economic development efforts.
Site Selection Magazine, a resource used by site selectors and economic developers across the country, lists which states are “Right to Work” and which are not. Site Selection Magazine makes this determination based on the list of Right to Work states created by the National Right to Work Legal Defense Foundation (“the Foundation”).
Upon reviewing the “Fair Share” legislation currently being debated in the Iowa Legislature, researchers at the Foundation have indicated that Iowa would be placed in a new category, called “Partial Right to Work,” if the law is enacted.
What does this mean? It means that businesses from outside Iowa looking to relocate or expand operations to a Right to Work state will look at a list that no longer includes Iowa. The chances of these site selectors or businesses looking at a new hybrid category or reading an asterisk or footnote are slim. And they will not be “reassured” by the limitations of the proposal. Although it only proposes to cover state employees now, there’s no guarantee it won’t be expanded into the remaining public and private sectors. As a result, Iowa will no longer be considered by companies looking to locate or expand in Right to Work states.
For all practical purposes in the economic development world, Iowa would lose any advantage it currently has as a Right to Work state. As economic developers, we need all the advantages and tools we can get to do our part to make Iowa as competitive as possible in the current global market.
The 22 Right to Work states have repeatedly seen faster economic and population growth. Since 2000, more than 5 million people have moved from Non-Right to Work states to Right to Work states. From 2003-2008, private sector employment in Midwestern Right to Work states has grown 7.2%, compared to only 1% in Midwestern states without Right to Work protection. The perception of the bill also has a detrimental effect on Iowa’s business development. A couple of years ago, when the Legislature discussed Fair Share, economic developers from across the state immediately saw at least six projects delayed in five communities that totaled over 600 jobs and $110 million in capital investment.
Since many companies consider Right to Work and other key labor issues critical to their location decisions, “Fair Share” legislation is not the direction Iowa should be going at a time when job creation is critical and our state’s economy is still fragile. Taking away our current economic development advantage as a Right to Work state would be a major mistake with lasting consequences for the health and vitality of Iowa’s business climate.
*Courtesy Des Moines Register
Iowa Chamber Alliance
321 East Walnut, Suite 100, Des Moines, IA 50309
Phone: (515) 284-6574 Fax: (515) 243-3199 E-mail: stratavizion@mchsi.com
