The Breakdown of Labor’s Social Contract

The Breakdown of Labor’s Social Contract

In 1950 John L. Lewis, head of the United Mine Workers of America (UMWA), and leading operators representing the entire softcoal industry negotiated the first National Bituminous Wage Agreement. It was a triumphant moment for Lewis, culminating an entire career of dogged effort at constructing a collective-bargaining system that would stabilize the cutthroat soft-coal industry. With the formation, after the 1950 agreement, of the Bituminous Coal Operators Association (BCOA), Lewis had the industrial partner he ardently desired. For the next decade, the BCOA-UMWA agreement worked as Lewis had intended. Although production declined by 20 percent, coal prices remained stable. Wages rose from $14.75 a day in 1950 to $24.25 in 1958, and royalty payments of 40 cents per ton financed a generous welfare-and-retirement fund. The high-wage structure stimulated the mechanization Lewis had long championed. Output per miner jumped from 6.77 to 12.83 tons during the decade, so that, despite steeply rising wages, labor costs actually fell by 8 percent. Economists estimated that the union impact on wages—the 30 percent of earnings beyond what the labor market for miners would have commanded—exceeded that of any other basic industry.

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Wurgraft | University of California Press Lima