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News from EPI “Right to Work” Is the Wrong Answer for New Mexico’s Economy

A new study shows that so called right to work (RTW) laws would hurt the economy in New Mexico by lowering wages. In the report, “Right to Work” Is the Wrong Answer for New Mexico’s Economy, published by the Economic Policy Institute, University of Oregon Associate Professor Gordon Lafer explains that, while lowering wages, right to work laws do not increase employment.

“The point of so-called `right to work’ rules is to drive down wages for both union and nonunion workers,” Lafer said. “These laws threaten the middle class.”

Key points in “Right to Work” is the Wrong Answer for New Mexico’s Economy include:

  • Right to work is associated with lower wages and benefits for both union and nonunion workers. In states with RTW laws, the average worker makes $1,500 per year less than a similar worker in a non-RTW state, even factoring in differences in cost of living.
  • Through cutting wages, RTW may undermine New Mexico’s small businesses, which depend on the state’s residents having wages to spend, and its healthcare industry, which is directly affected if there is a decline in the number of people with health insurance benefits.
  • Oklahoma is the most recent state to adopt RTW (in 2001), for which we have enough data to determine the law’s impact. Oklahomans were told that RTW would result in a 90 percent increase in the number of new jobs coming into their state; instead, in the ten years after adopting RTW, the number of jobs created by new companies coming into the state fell by one-third.
  • New Mexico is already a low-wage state; the idea that cutting wages yet further will attract outside manufacturers has no basis in economic evidence.

“New Mexico lawmakers trying to attract high tech manufacturing jobs should know that all evidence points to NON-right to work states having the advantage in attracting these jobs,” said Lafer.

Lafer noted that studies supporting right to work which have been funded by large corporate CEOs have cherry picked facts dating back to the 1950’s pre-globalized economy and ignore New Mexico specific data.

Many of the arguments made by advocates of so-called right to work ignore that under federal law it is already illegal to force anyone to be a member of a union, and it is already illegal to force workers to pay even a penny to political causes.

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