Deindustrialization of Detroit: the push of organized labor

ABSTRACT

This article takes a step in identifying a more accurate economic history of deindustrialization. Following the extension of the timeline of deindustrialization and its divorce from the 1970s, this article examines the reasons for production facility relocation our of Detroit, prior to the 1970s. Given that the process of deindustrialization occurred prior to 1970, the reasons must be reevaluated. To this end, this article examines one of the lesser investigated reasons that auto corporations moved their production facilities out of Detroit; organized labor. It shows that organized labor was one of the driving factors of production facility relocation. This article makes use of multiple collections housed in the Reuther Archives at Wayne State University in relation to organized labor, as well as union density data. This article details how and why production facilities were pushed out of Detroit in an effort to evade organized labor.

KEYWORDS:

• economic history
• deindustrialization
• Detroit, MI
• auto industry
• organized labor

Acknowledgments

I would like to thank Gerald Friedman and Kevin Boyle for the continued feedback and support. I would also like to thank Gretchen Lemke for her guidance on detail and organization.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Notes

1. For a discussion of the 1970s as the traditional timeline of deindustrialization, please see the introduction to Battista (2022), ‘A New Timeline for Deindustrialization,’ where the author lays out the acceptance of the 1970s based on the work on the subject that has been done.

2. The traditional narrative of deindustrialization is one in which the reasons for factory movement are based on the traditional timeline of deindustrialization. This means that the traditional narrative of deindustrialization is one that is solely based on a set of determinants that is unique to the 1970s.

3. By looking at this time period it becomes clear that there was movement pre-1970 and that the Big 3 auto-manufacturers were engaging in a strategy to geographically reorganize production.

4. This means that organized labor is being investigated as a reason for the relocation of production facilities. Many authors do not focus on organized labor as a rationale for relocation, which is added by this paper. The argument is not that this is the sole reason for movement. Addressing every reason for this movement is not possible within the confines of this paper. Additionally, this article addresses plant movement. While closely tied to deindustrialization, this article also does not forward the argument that organized labor is responsible for the entire process of deindustrialization.

5. As noted multiple times thus far, this article looks at the potential reasons for movement of plants and factories. The effects that this migration and the process of deindustrialization had on the city, the population, employment, etc. is a separate topic and is not the focus of this article. While these effects are interesting, it is the topic of a different article, and more space is needed to do the topic justice.

6. This current article finds no evidence that plants were relocated simply for spatial reasons. In terms of automation, this leads to increases in output and reduced labor costs, which Sugrue argues adds to capital’s ‘anti-labor arsenal.’ While it is true that this is a strategy opposing organized labor, it is not necessarily a strategy or reasons to relocate production in and of itself.

7. Cowie first chronicles the migration of the RCA plant from Camden, New Jersey from 1929–1950, to Bloomington, Indiana from 1940–1968, to Ciudad Juarez, Mexico from 1964–1978, and then returning to Bloomington and Ciudad Juarez from the early 1970s to 1998.

8. These cost considerations are not the focus on this current article. This article looks specifically at organized labor. Cost considerations, including taxes, tax breaks, and tax-exempt municipal bonds are all a focus of a different article. There is not enough space here to consider every interrelated reason for movement.

9. Further, T. J. Sugrue (1996) disagrees with this premise, stating that ‘auto manufacturers were in the vanguard of corporate decentralization’ (p. 128).

10. This ‘bidding’ process is consistent with the process of how corporations decide where to place their production facilities, i.e. finding those locations that offer them the best deal.

11. When the terms ‘corporate exit or relocation’ is used in this article, it is used to refer to the mass exodus of production out of their current production centers. The intention is not to say that corporate headquarters or that the entire corporate itself is moving. Further, many of these influences were rooted in the conflict between capital and labor, whether direct or indirect.

12. Based on this realization, and as this survey indicates, this article takes that approach as well. It looks at the attitudes of manufacturers and those in power. Therefore, the focus in on those presidents, vice presidents, and CEOs and the decisions they espoused and/or made, as well as the responses of union (UAW) leadership.

13. This observation lines up with the argument, but it is not a direct causal connection. That is, the areas where companies were moving their production facilities are correlated with lower union density states. However, this does not mean that this movement occurred directly because of the lower union density or to directly evade organized labor. The causal connection is tied to the qualitative data to show a strong causal effect, when connected with the data on union density.

14. Additionally, while it is always better to have as much information as possible, the amount is limited. It would be nice to have all of the union accounts, all of the workers accounts, etc. but they are not available. The information available comes from ownership, who directly state their intentions for movement and relocation.

15. Cowie in Stayin’ Alive and Cowie and Heathcott in Beyond the Ruins reveal the inescapable position that workers found themselves in as a result of deindustrialization, and the subsequent loss of control over the production process, the decline in union bargaining power, and the ability of workers to share in the returns to their labor.

16. You can see Farber et al. for different information about these measurements. However, the measurements are presented on a much more aggregate level than is used in this current article.

17. While these measures do not extend as far back as the timeline for this current research, it does provide enough empirical data to establish the general pattern of corporate relocation from higher to lower union density areas. Further, in looking at the breakdown, this is as specific as the collected data gets. There is no data available for smaller geographical areas, i.e. counties, cities, or metropolitan areas. Therefore, the data being used here it the best available, on the smallest geographical level that we currently have.

18. The union density or union membership rate is the ratio of the number of employees who are members of trade unions to all the employees in a country or population.

19. The states in question are pulled from the movement locations that are documented in Battista, ‘New Timeline,’ who maps the physical movement of plants and factories out of Detroit from 1940–1980. States where production facilities popped up, based on that data, are included in this analysis moving forward, instead of including all states.

20. This union density is returned to following the case studies, to address the pattern of movement to these lower union density areas between the years of 1964–1973 and 1964–1980.

21. As an aside, even if certain industries were unionized nationally, there are regional specifics to the how strong unions are in a specific area. As such, what matters is how well the union actually functions in practice in a given area, not just that there is a union. If you are a union member and that union has no sway in your geographical region, or the union is so new, there is the potential that unionized work is not completely different from non-unionized for in those areas.

22. Corporations also reveal, through omission, that they do not move their production facilities to acquire acreage to build larger factories and spread-out production across a larger geographical space. While this is outside the scope of this article, this is a point that Sugrue focuses on, but that does not arise in this current research. While the result is some cases may have been movement to an area with more space, this was not a driving factor.

23. Address given by General Motors President C.E. Wilson (1946), UAW Research Department Records, Box 87, Folder 13, Walter P. Reuther Library, Archives of Labor and Urban Affairs, Wayne State University Detroit, MI.

24. Address given by General Motors President C.E. Wilson (1946), UAW Research Department Records, Box 87, Folder 13, Walter P. Reuther Library, Archives of Labor and Urban Affairs, Wayne State University Detroit, MI.

25. Address given by General Motors President C.E. Wilson (1946), UAW Research Department Records, Box 87, Folder 13, Walter P. Reuther Library, Archives of Labor and Urban Affairs, Wayne State University Detroit, MI. p. 4.

26. Address given by General Motors President C.E. Wilson (1946), UAW Research Department Records, Box 87, Folder 13, Walter P. Reuther Library, Archives of Labor and Urban Affairs, Wayne State University Detroit, MI.

27. Address given by General Motors President C.E. Wilson (1946), UAW Research Department Records, Box 87, Folder 13, Walter P. Reuther Library, Archives of Labor and Urban Affairs, Wayne State University Detroit, MI.

28. Address given by General Motors President C.E. Wilson (1946), UAW Research Department Records, Box 87, Folder 13, Walter P. Reuther Library, Archives of Labor and Urban Affairs, Wayne State University Detroit, MI.

29. Address given by General Motors President C.E. Wilson (1946), UAW Research Department Records, Box 87, Folder 13, Walter P. Reuther Library, Archives of Labor and Urban Affairs, Wayne State University Detroit, MI.

30. UAW Appeal Board of the Michigan Unemployment Compensation Commission [concerning Chrysler denial of unemployment compensation] (1942). UAW Research Department Records, Box 3, Folder 3, Walter P. Reuther Library, Archives of Labor and Urban Affairs, Wayne State University Detroit, MI.

31. concerning (1942). UAW Research Department Records, Box 3, Folder 3, Walter P. Reuther Library, Archives of Labor and Urban Affairs, Wayne State University Detroit, MI.

32. concerning (1942). UAW Research Department Records, Box 3, Folder 3, Walter P. Reuther Library, Archives of Labor and Urban Affairs, Wayne State University Detroit, MI.

33. concerning (1942). UAW Research Department Records, Box 3, Folder 3, Walter P. Reuther Library, Archives of Labor and Urban Affairs, Wayne State University Detroit, MI.

34. concerning (1942). UAW Research Department Records, Box 3, Folder 3, Walter P. Reuther Library, Archives of Labor and Urban Affairs, Wayne State University Detroit, MI.

35. ‘150,000 Employees made Idle.’ Detroit News. May 7, 1940 (Press Release Walter Reuther and Norma Matthews, Thursday, 1957).

36. ‘Chryslers Workers Denied $2,000,000.’ Detroit News, October 13, 1942. This apparent overreach by the state in favor of Chrysler clearly indicates that the state is not a neutral party. Further, an entire analysis and theory of the State as it related to deindustrialization is outside of the scope of this project. However, while this project does not focus directly on the State, it is important to identify that the State does play a role in the process of corporate exit and the subsequent deindustrialization.

37. Press Release Walter Reuther and Norma Matthews, Thursday, . UAW Research Department Records, Box 14, Folder 6, Walter P. Reuther Library, Archives of Labor and Urban Affairs, Wayne State University Detroit, MI. p. 1.

38. Union Acts to Prosecute Ford in Beating of Two Organizers,” The Christian Science Monitor, May 27, 1937. “C.I.O. Leaders Slugged, Driven Off in Attempt to Spread Handbills,” Washington Post, May 27, 1937. Ford Men Beat and Rout Lewis Union Organizers,’ New York Times, May 27, 1937.

39. Meeting Between Walter P. Reuther and John S. Bugas from Communication from John S. Bugas to Walter P. Reuther, September 19, (1951) (1951), UAW Research Department Records, Box 81, Folder 13, Walter P. Reuther Library. Archives of Labor and Urban Affairs, Wayne State University Detroit, MI. p. 1.

40. Meeting Between Walter P. Reuther and John S. Bugas from Communication from John S. Bugas to Walter P. Reuther (1951), UAW Research Department Records, Box 81, Folder 13, Walter P. Reuther Library. Archives of Labor and Urban Affairs, Wayne State University Detroit, MI.

41. Meeting Between Walter P. Reuther and John S. Bugas from Communication from John S. Bugas to Walter P. Reuther (1951), UAW Research Department Records, Box 81, Folder 13, Walter P. Reuther Library. Archives of Labor and Urban Affairs, Wayne State University Detroit, MI.

42. Meeting Between Walter P. Reuther and John S. Bugas from Communication from John S. Bugas to Walter P. Reuther (1951), UAW Research Department Records, Box 81, Folder 13, Walter P. Reuther Library. Archives of Labor and Urban Affairs, Wayne State University Detroit, MI. p. 1.

43. Communication from John S. Bugas to Walter P. Reuther (1951). UAW Research Department Records, Box 81, Folder 13, Walter P. Reuther Library, Archives of Labor and Urban Affairs, Wayne State University Detroit, MI.

44. Meeting Between Walter P. Reuther and John S. Bugas from Communication from John S. Bugas to Walter P. Reuther (1951), UAW Research Department Records, Box 81, Folder 13, Walter P. Reuther Library. Archives of Labor and Urban Affairs, Wayne State University Detroit, MI. p. 2.

45. Telegram from Walter Reuther to Henry Ford II (1955). UAW Research Department Records, Box 12, Folder 11, Walter P. Reuther Library, Archives of Labor and Urban Affairs, Wayne State University Detroit, MI.

46. Telegram from Walter Reuther to Henry Ford II (1955). UAW Research Department Records, Box 12, Folder 11, Walter P. Reuther Library, Archives of Labor and Urban Affairs, Wayne State University Detroit, MI.

47. Telegram from Henry Ford II to Walter Reuther (1955a). UAW Research Department Records, Box 12, Folder 11, Walter P. Reuther Library, Archives of Labor and Urban Affairs, Wayne State University Detroit, MI.

48. Telegram from Henry Ford II to Walter Reuther (1955a). UAW Research Department Records, Box 12, Folder 11, Walter P. Reuther Library, Archives of Labor and Urban Affairs, Wayne State University Detroit, MI.

49. Telegram from Henry Ford II to Walter Reuther (1955b). UAW Research Department Records, Box 12, Folder 11, Walter P. Reuther Library, Archives of Labor and Urban Affairs, Wayne State University Detroit, MI.

50. Telegram from Walter Reuther to Henry Ford II (1955) – May 30 (1955b)., UAW Research Department Records, Box 12, Folder 11, Walter P. Reuther Library, Archives of Labor and Urban Affairs, Wayne State University Detroit, MI.

51. Speech Given by Henry Ford II, President, Ford Motor Company, Buffalo, NY (1950). What Kind of Citizens Are We? UAW Research Department Records, Box 83, Folder 3, Walter P. Reuther Library, Archives of Labor and Urban Affairs, Wayne State University Detroit, MI.

52. Speech Given by Henry Ford II, President, Ford Motor Company, Buffalo, NY (1950) What Kind of Citizens Are We? UAW Research Department Records, Box 83, Folder 3, Walter P. Reuther Library, Archives of Labor and Urban Affairs, Wayne State University Detroit, MI.

53. Speech Given by Henry Ford II, President, Ford Motor Company, Buffalo, NY (1950) What Kind of Citizens Are We? UAW Research Department Records, Box 83, Folder 3, Walter P. Reuther Library, Archives of Labor and Urban Affairs, Wayne State University Detroit, MI. p. 1.

54. One interesting aspect here that is outside the scope of this current paper, is that with Ford’s move Ford II’s admission, Buffalo wages were by no means low. This indicates that the relocation was not necessarily motivated by reducing labor costs, at least not in the short-run. Rather, Ford preferred the Buffalo location because it had fewer production restrictions and because labor was less organized than in Detroit.

55. Address given by Benson Ford to the Mississippi Automobile Dealers Association, Biloxi, Mississippi, Monday (1957). UAW Research Department Records, Box 45, Folder 1, Walter P. Reuther Library, Archives of Labor and Urban Affairs, Wayne State University Detroit, MI.

56. Address given by Benson Ford to the Mississippi Automobile Dealers Association, Biloxi, Mississippi, Monday (1957). UAW Research Department Records, Box 45, Folder 1, Walter P. Reuther Library, Archives of Labor and Urban Affairs, Wayne State University Detroit, MI. p. 10.

57. Address given by Benson Ford to the Mississippi Automobile Dealers Association, Biloxi, Mississippi, Monday (1957). UAW Research Department Records, Box 45, Folder 1, Walter P. Reuther Library, Archives of Labor and Urban Affairs, Wayne State University Detroit, MI.

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Jackson Battista

Jackson Battista is an economic historian and assistant professor of economics at Saint Mary’s College of California, Moraga, CA. His research focuses on the process of deindustrialization, its causes, and its effects.