The Cost of Brotherhood -{1}- Who Really Pays the Dues?

In 1937, the United Auto Workers staged a sit-down strike at General Motors’ Flint, Michigan plant. For 44 days, workers occupied the factory, demanding recognition and better conditions. They won. That victory helped secure the 40 hour workweek, safer workplaces, and collective bargaining, lifting millions into the middle class.

Fast forward to 2025, and unions still wear that legacy with pride. But today, the cost of maintaining union power isn't just about dues. It's systemic. And the burden reaches far beyond just the members on the payroll. From struggling cities to shuttered small businesses, and even the union workers themselves, who’s really footing the bill for brotherhood?

Union Membership: The Lay of the Land

Unions don’t hold the dominance they once did. In 2024, only 9.9% of U.S. workers were unionized, according to the Bureau of Labor Statistics. But some regions still carry deep union roots. The Detroit-Warren-Dearborn metro area sits at 15.8% union membership (Quartz, 2024). Illinois, which includes Chicago, reports 13.1% (Illinois Economic Policy Institute, 2024).

These strongholds still carry influence. But that influence comes with a shadow, economic and social costs that ripple through entire communities.

The Economic Toll of Union Density

Poverty’s Grip on Union Heavy Cities

Cities like Detroit and Chicago have rich labor histories. But their economic health tells a harder story. Detroit’s poverty rate in 2023 was 31.5%, nearly triple the national average of 11.1% (DataUSA, 2023; Census Bureau, 2023). Chicago, while more stable, still posted a 16.8% poverty rate (DataUSA, 2023).

Why the gap? One explanation is that high union wages can inflate local costs, which prices out low skill workers and drives up unemployment. A 2019 study by the National Bureau of Economic Research found that unionized industries often shed jobs when labor costs rise sharply. The result? Fewer opportunities for vulnerable workers.

Crime statistics add weight. Detroit recorded 203 homicides in 2024, its lowest count since 1965, yet still among the highest per capita in the U.S. (City of Detroit, 2024). Chicago saw 573 homicides the same year (WTTW, 2024). Poverty and crime tend to feed each other. And when unions drive higher municipal costs, city budgets get strained. That means less money for social services and public safety, leaving vulnerable communities even more exposed.

Small Businesses: Locked Out

Unions frequently push for wage floors and exclusive labor agreements. For small businesses, those conditions can be a wall too high to scale.

A 2012 study in the Industrial Relations Journal found that right-to-work states, where workers aren't required to join unions, had 23% higher rates of new business formation than union heavy states (Holmes, 2012). In cities like Detroit, public project contracts often favor large, unionized firms. Smaller operations that can't meet union terms are left out entirely.

In Chicago’s construction sector, union rules sometimes dictate which specific trades are allowed to perform certain tasks. That can drive up both project timelines and costs. For non-union firms, competing for city contracts becomes nearly impossible. That stifles innovation, growth, and job creation especially in neighborhoods that need economic churn the most.

Hidden Costs: Union Dues and Crumbling Cities

Union members pay dues, typically between $500 and $1,000 per year, to support collective bargaining and union operations. But those dues are just the start.

In union heavy cities, public sector unions drive up municipal costs through pensions and benefits that stretch budgets thin. A 2023 report from the Manhattan Institute found that pension obligations in Detroit, tied primarily to unionized public employees, consumed roughly 20% of the city’s entire budget. That leaves less for basic infrastructure like roads, water systems, and schools.

The effects show up in property values. According to Zillow data, median home values in Detroit fell by 2.3% between 2023 and 2025. In Chicago, prices dipped by 0.8%. Meanwhile, Charlotte, a city with only 4.2% unionization, saw a 4.5% increase over the same period. The pattern is clear: when cities become less attractive to new business or outside investment, the local economy stalls. And when the economy stalls, neighborhoods decline.

Whether you're in a union or not, the cost comes due.

The Other Side

Unions aren’t the only factor in these cities’ struggles. Deindustrialization, poor leadership, and global market shifts have played a role. And to be fair, unions still offer real benefits: BLS data shows that union workers earn 10–20% more than their non-union peers and tend to have better healthcare and retirement plans.

But the question remains: at what cost? When union gains begin to fuel poverty, stagnation, and structural decline, the price isn't just borne by "the other guy." It's paid by everyone, including the members themselves.

Looking Ahead

Unions were once the backbone of the working class. But today, their survival may be undermining the very communities they were built to serve.

In Part 2, we’ll look at what happens when union loyalty starts tearing teams apart, how rigid contracts and outdated hierarchies can divide workers instead of empowering them.

For now, we ask this: Can unions evolve with the times? Or are they clinging to a model that no longer works in a changing economy?

Sources & Citations

• Bureau of Labor Statistics. (2024). Union Members – 2024. Retrieved from https://www.bls.gov/news.release/union2.nr0.htm
• Quartz. (2024). Where America’s union membership is still strong. Retrieved from Quartz.com
• Illinois Economic Policy Institute. (2024). Union Membership and Impact in Illinois. Retrieved from illinoisepi.org
• DataUSA. (2023). Detroit, MI & Chicago, IL City Profiles. Retrieved from datausa.io
• United States Census Bureau. (2023). Poverty Data Tables. Retrieved from census.gov
• National Bureau of Economic Research. (2019). The Impact of Unions on Employment and Productivity. Retrieved from nber.org
• City of Detroit. (2024). Crime Statistics Annual Report. Retrieved from detroitmi.gov
• WTTW News. (2024). Chicago Homicide Trends. Retrieved from news.wttw.com
• Holmes, T. (2012). Right-to-Work and Small Business Growth. Industrial Relations Journal.
• Manhattan Institute. (2023). Detroit’s Pension Crisis: A Case Study. Retrieved from manhattan-institute.org
• Zillow. (2023–2025). Median Home Value Trends – Detroit, Chicago, Charlotte. Retrieved from zillow.com