By Alfred L. Malabre

The Wall Street Journal (Friday, June 25, 1971)

Less of the labor force is unionized in the U.S. Than in most industrial countries. The percentage has been shrinking. And there is reason to believe that the shrinkage will continue.

Over the long run, such facts suggest that pay boosts won by organized labor may exert less direct impact on labor costs throughout the economy than they do today. The record indicates that unions, far from assuming an ever larger role in the U.S. economy, are actually struggling to maintain their relative position. "Far too much power has been attributed to unions by those looking for an easy explanation to recent inflationary pressures," says Leo Troy, a Rutgers University economist who studies union developments.

An economist at the federal Reserve Board in Washington claims that "the facts simply don't support the charge that unions have recently grown all-powerful and must somehow be curbed." He adds "the roots of our inflation extend far beyond union power--to fiscal and monetary policies, the Vietnam war and some basic changes taking place in the structure of our economy."

There's no question, of course, that U.S. unions have recently been winning huge pay packages, and that these well-publicized packages--particularly in such industries as construction--have encouraged workers generally to be more demanding. "Union increases tend to set the pattern for everyone else," declares George P. Hutchings, economist for C.I.T. Financial Corp. Mr. Hutchings, who specializes in labor trends, adds: "In recent years, many unions have discovered that they can demand, and get, really big pay increases."

Charles E. Walker, Under Secretary of the Treasury, voices a similar opinion. "Unions may be getting less powerful, in terms of how much of the labor force they represent," the official says. "But they may also be getting meaner."

Meaner or not, at first glance, statistics hardly seem to back up claims that unions may be getting less powerful in the U.S. In absolute terms, government figures show, nearly 20 million U.S. workers, a record, belong to unions. This dwarfs the number of union members in such non-Communist nations as the United Kingdom and West Germany. If U.S. unionization is viewed in terms of the country's total labor force, however, an entirely different picture emerges.