ONE OF THE reasons CNBC named Virginia the “top state for business” in 2021 is its right-to-work status. Although that certainly wasn’t the only reason, as all the commonwealth’s closest competitors are right-to-work states as well, it was a factor.
That’s why Democratic gubernatorial candidate Terry McAuliffe’s recent pledge to repeal the law if he’s elected governor again is so worrisome.
A lot of Virginians still do not understand what the commonwealth’s right-to-work law, adopted in 1947, does and doesn’t do. It doesn’t prevent workers from joining labor unions, or unions from representing them in collective bargaining. It does prohibit those same unions from forcing workers who do not want to join the union to pay mandatory union dues to keep their jobs.
The right to work without a union grabbing a chunk of your paycheck is not a minority position. Twenty-nine states, including Virginia, have right-to-work laws on the books, compared to 23 that make paying union dues compulsory, even for employees who don’t want to belong to a union. But those 23 states are bleeding workers.
According to the most recent migration data from the Internal Revenue Service, in 2018 forced-union states lost a net total of 212,000 tax filers who left and filed their 2019 tax returns from right-to-work states. This domestic out-migration cost state and local governments in the 23 states lacking right-to-work laws a total of $31.3 billion in adjusted gross income in 2019 alone. And the loss of taxable income is compounded year after year.
In April, McAuliffe flip-flopped from his previous pledge to “never change” Virginia’s right-to-work law by stating that he would sign a bill to repeal it. “If it came to my desk, sure, I’d sign it,” he told the Democratic Business Council of Northern Virginia shortly before Big Labor contributed $2.2 million to his campaign.
However, the Virginia Economic Development Partnership, the state agency working to lure new business projects to the commonwealth, warned that repealing the law would jeopardize 260 potential manufacturing and supply chain projects that would create more than 32,700 new jobs and bring $16.7 billion in capital investment to Virginia.
The commonwealth would also lose “approximately $8-26 million in state general fund revenue per year from our current prospect pipeline, a loss of revenue that would grow over time as Virginia is not considered for future projects or is not selected due to changes in its ‘right to work’ status.”
Local economic development officials in the Fredericksburg region would face the same problem if the General Assembly repeals a 74-year-old law that has undoubtedly helped Virginia prosper and become the nation’s top state for business. Yet McAuliffe says he would sign such a bill.
Beware of politicians who promise to fix what’s not broken.