The Labor Movement to War

The history of organized labor in the 20th century is one of short periods of sharp growth followed by long periods of gradual decline.

When Workforce was launched in 1922, union power was declining, in part because of the successes of personnel officers in improving management practices.

The Great Depression, however, ushered in a new wave of union activity. In 1935, John Lewis created the CIO, the Congress of Industrial Organizations, and union activity swiftly spread to large sectors of American industry. Its counterpart, the American Federation of Labor, was equally successful in unionizing large segments of the workforce. These triumphs continued well past World War II.

“At the time, the labor movement represented the coming into citizenship of second-generation immigrants,” says Professor Nelson Lichtenstein of the University of California at Santa Barbara. Unions helped Catholics, Italians, Jews, and other so-called “second-class citizens” to enjoy the full benefits of working in the WASP-dominated world of work. “Big spikes in union membership have always coincided with efforts to accord certain disenfranchised groups the full rights and benefits of American citizenship,” Lichtenstein says.

Following World War II, unions fell into a long period of declining membership until the 1968 Memphis Sanitation Strike, when another marginalized group — African-American garbage men — refused to work until they were granted minimum wage. Their success led to a burst of union organizing among public-sector employees. As a result of the momentum generated by the strike, 30 percent of public employees are in unions today, versus 5 percent in the 1950s.

In the early 1980s, the Reagan administration initiated a political offensive that resulted in the breakup of the Professional Air Traffic Controllers Association. This event, combined with the strengthening of anti-union political and management forces, launched the current period of union decline. Today, only 9.5 percent of private-sector employees are unionized, versus 33 percent in the 1950s.

In 1946, after completing a stint as an Army auditor, an enterprising young man named William Russell Kelly came up with a novel idea. Why not help businesses manage excess work by providing temporary employees? The nation was in the midst of a postwar boom, and many businesses simply couldn’t hire personnel fast enough. With $10,000 in personal savings, he opened the first Russell Kelly Office Service in Detroit. It was a phenomenal success.

Two years later, Manpower Inc. opened its doors in Milwaukee. Over the years, the staffing-services industry has exploded into a multibillion-dollar global enterprise with tens of thousands of customers and locations in 60 countries. In response to the changing needs of the workplace, staffing companies have greatly expanded their function and expertise. The Kelly Girl of yore is no longer the stereotypical smiling secretary. She has joined her brothers to provide platoons of employers with expertise in fields such as computer programming, engineering, teaching, and law.

Above all, the temp concept profoundly changed the fundamental thinking about permanence and loyalty in the workplace. The notion of working the same hours at the same job for a lifetime gave way to more flexible schedules and attitudes about the nature of work.

Few individuals have represented the labor rights of the poor and oppressed as successfully as Chavez. In 1962 he formed the National Farm Workers Association, with the intent of serving farm workers, particularly Latino and Filipino, who had been forced to endure substandard wages and working conditions. In 1966, the AFL-CIO chartered the union as the United Farm Workers of America, and Chavez remained its president until his death in 1993 at age 66.

In the 1960s and ’70s, he led several successful campaigns, including a grape boycott that was observed by more than 17 million Americans.

By the early 1980s, tens of thousands of farm workers under UFW contracts received higher pay, family health coverage, pensions and other contract protections, all of which directly affected human resources within the farming community and beyond.

No invention has changed HR more radically than the personal computer. Today, it’s on the desk, in the lap, and even in the palm. Employees use it to update personal information, make benefits selections, manage 401(k) accounts, and connect to the office remotely. Organizations depend on the PC to manage recruiting, hiring, employee evaluations, succession planning, and benefits enrollment. There’s hardly a human resources activity that doesn’t use the PC. “It is central to HR,” says John Boudreau, professor of human resources at Cornell University. “It has unleashed a new era of productivity.”

Ironically, when it was first introduced in the early 1980s, many observers imagined that the PC was largely irrelevant and would never play a central role in HR. It was believed that it couldn’t take the place of people skills and couldn’t manage the “softer” side of the business. While PC industry founders like Microsoft’s Bill Gates and Apple’s Steven Jobs might have envisioned otherwise, it has taken HR years to migrate from paper to pixels. Today’s PC and networked workplace are changing where HR works, and how it works, while cutting costs and boosting productivity.

Through good and bad economic times, Wall Street, indirectly and directly, has influenced HR for the past 80 years. Strong financial periods such as the 1920s brought increased pressure on organizations to beat earnings expectations. Little attention was paid at that time, however, to HR’s role in boosting those earnings.

HR’s role changed dramatically in the 1990s, a decade of strong economic growth. Many trendy HR programs — telecommuting, flextime, job sharing, and casual days — were indirect responses to Wall Street’s desire to squeeze even more profits from booming companies during this period, says Mark Pramuk, a senior analyst at IDC, a market-research firm. “There was a call to action for HR: Don’t be an administrative cost center. Be an agent for change. Address the happiness, well-being, and morale of employees.”

In tough times, Wall Street’s influence has been just as great, though not without controversy. To meet Wall Street’s quarterly earnings projections and boost stock prices, companies recently have cut payroll and benefit costs. “This is a short-sighted attempt to realize short-term gains that in most cases hurt the company in the long term,” he says.

Several of Truman’s actions had a direct bearing on HR, including his proposal for the country’s first national health-care plan and his engineering of the desegregation of the armed forces. In 1948, it was his Committee on Equality of Treatment and Opportunity in the Armed Services, widely known as the Fahy Committee, that mandated an end to racial discrimination and segregation in the military.

The policy had a far-reaching impact on hiring practices and served as a model for future legislation, ensuring that there would be equality of treatment and opportunity for all members of the workplace — regardless of race, color, religion, or national origin.

Truman also signed into law other sweeping reforms, including a full-employment program, permanent fair labor standards legislation, public housing, and slum clearance.

After the Fahy Committee submitted its final report in 1950, the Army issued a new mandate,”Utilization of Negro Manpower in the Army.” The directive eliminated quotas and segregated units and facilities. The Women’s Army Corps (WAC) conformed with the Army directive by revising its administrative policies and assignment procedures. By the middle of the year, WAC training and field units were integrated.

Today, work and life are inexorably intertwined. The commute offers an opportunity to make business calls on the mobile phone, evenings and weekends are a time to complete reports and presentations. Those heading off on a vacation remain tethered to phones, PDAs, and laptops.

In the U.S., the average workweek is 46 hours, and 38 percent of the population toils for more than 50 hours per week. A Canadian survey found that 47 percent of women have considered leaving their current jobs because of a lack of balance in their lives. Job sharing and on-site day care are a boon to many families, but many still seek shorter workweeks, telecommuting, and other flexible work options.

Yet even these tools don’t provide all the answers, says Christena Nippert-Eng, an associate professor in social sciences at the State University of New York at Stony Brook. Working from home hasn’t created the work-life balance that many desire. “We feel less able than ever to place appropriate boundaries around the workday, while at the same time, we realize the need for those boundaries more than ever before.”

With the publication of The Feminine Mystique in 1963, Friedan changed the consciousness of the country — and the world. The landmark book helped launch the feminist movement, and awakened women and men to social relations, domestic politics, and women and work. As author Alvin Toffler wrote, it was “the book that pulled the trigger on history.”

Ever an intellectual and an activist, Friedan founded the National Organization for Women in 1966. With the backing of NOW, she helped press groundbreaking lawsuits against sex discrimination in employment, winning millions in back pay for women. NOW continues to expose and address workplace issues related to the glass ceiling and sexual harassment.

Over the years, Friedan has been a major figure in the sweeping changes that put more women in political posts; increased educational, employment, and business opportunities for women; and enacted tougher laws against violence, harassment, and discrimination.

She and other leading feminists such as Gloria Steinem are united in their promise of winning economic equality and equal rights for women. Friedan once wrote, “A woman is handicapped by her sex, and handicaps society, either by slavishly copying the pattern of man’s advance in the professions, or by refusing to compete with man at all.”

Over the last century, an avalanche of regulations has descended on employers, centering on safety requirements, ergonomics, environmental controls, employment rules, financial reporting, and consumer policies. Many of these regulations fall directly into the lap of the human resources department. And the penalties for not adhering to rules can include fines and, in severe cases, the shutting down of a business.

This battle over regulation is nothing new. Many regulations now in place — including child labor laws, minimum wage, and basic environmental protections — were once considered fringe ideas, though it’s harder to find anyone opposed to them today. In the 1960s, a flurry of activity took place under President Lyndon B. Johnson. This included the Civil Rights Act of 1964, which contained anti-discrimination policies that were part of Title VII. Later, in the 1970s, government created OSHA to oversee workplace safety, and in 1991, President George Bush signed the Americans with Disabilities Act and also the Civil Rights Act of 1991.

Ultimately, says Tom Dougherty, a professor of management at the University of Missouri, “business sees regulations as poorly written, ambiguous, expensive, and difficult to comply with, but pressures from the citizenry to provide more worker protections continue.”

Legal and illegal immigrants make up 13 percent of the nation’s workforce, the highest percentage since the 1930s. Most of these 17.7 million workers labor at menial jobs that many native-born Americans shun, and the U.S. economy couldn’t function without them.

Before 1924, immigration to the United States was largely open; after that year, the laws changed and it became much harder to get into the country. The result was that immigrants were either as educated or better educated than the average American. After the 1960s, immigration focused on reuniting families. The average immigrant today — with notable exceptions, especially in the high-tech industry — is less educated than ever before.

Robert Gitter, professor of economics at Ohio Wesleyan University and a specialist in labor economics, says HR professionals have had to learn how to integrate immigrant workers, making sure that instruction is available in a variety of languages and that it is accessible to those with little or no formal education. Cultural differences among employees in the workforce also have created friction, and have thrust HR professionals into new roles managing multicultural workforces.

HR also is becoming expert in navigating immigration law because of the urgent need that U.S. companies have for highly skilled high-tech workers.

During World War I, psychologist Walter Dill Scott tested enlisted men to figure out what jobs they’d be best in. Army Alpha was the first group-intelligence test, and its 212 questions covered everything from math and grammar to general knowledge. When the military realized that many draftees couldn’t read, it added Army Beta, which was lighter on words and heavier on diagrams.

About 2 million men took Alpha and Beta during the first world war. Another 9 million took aptitude tests during World War II. Similar tests were later implemented in the civil service, and in the private sector. They continue to be popular in the workplace today.

Every 10 seconds between 1946 and 1964, a baby boomer was born. This mammoth generation of 76 million people has profoundly affected the American workplace.

When boomers began to flood the workplace in the 1970s, wages stopped increasing because of the abundant labor supply. In the 1980s, boomers started having families, and suddenly, money, job security, and gender equality became their focus. But it wasn’t until the 1990s, when boomers started to reach upper management, that the full force of their impact was felt.

In the last decade, boomers ushered in casual dress and sweeping anti-discrimination laws. They demanded — and received — flexible work arrangements, work/family benefits, and on-site day care. When they discovered that there weren’t enough management positions to accommodate the number of qualified boomers, they dismantled the corporate hierarchy and began to value lateral promotions and continuous learning. Teamwork became the norm, as boomers searched for less formal and more participative styles of management.

Today, one boomer turns 50 every few seconds, and the threat of massive retirements has companies worried — for good reason. Whether boomers retire at 65 or continue to work, their decisions will have an effect on American industry, just as they have for the last 30 years.

In the past half-century, health insurance and managed care have become major issues affecting the employer-employee pact. “In many countries, government or quasi-official funds handle health insurance,” says Daniel Mitchell, a professor of HR at UCLA. “At most, the employer’s role is to pay payroll taxes to support the program.” Health insurance in the United States was originally planned to be part of Social Security, but opposition forces tried several times to have the state legislatures pass state-run health insurance plans for all employees instead. That too was shot down.

Today most major employers offer group health insurance coverage. From a corporate perspective, group insurance is appealing because benefits aren’t subject to income taxes and group rates often drive down costs. Employees, too, wind up avoiding income taxes on such benefits as health coverage. Yet, managing these programs requires sophisticated technology and careful attention to detail. As a result of having responsibility for health insurance, Mitchell says, HR derives status and has become an indispensable part of many organizations.

In his book The World According to Peter Drucker, author Jack Beatty writes, “On or about November 6, 1954, Peter Drucker invented management.” The dramatic assessment has proved to be true. Drucker’s writings did provide a philosophical and practical basis for the modern corporation. A management consultant and educator, the Austrian-born Drucker published The Practice of Management in 1954, the first book to codify management as a discipline.

“We’ve always had managers, and there was quite a bit written about managers before Drucker’s book, but nothing about management. We didn’t have a systematic way to teach management. The book made it possible to convert ordinary people into good managers,” says Joseph Maciariello, a professor at the Peter F. Drucker Graduate School of Management in Claremont, California.

Drucker believes in employing people on the basis of their strengths and covering their weaknesses with the strengths of others. Much of the work leading up to his book was conducted at GE, where he changed the functions of HR from paper-pushing and what Maciariello terms “hygiene” to career development. It had an enormous impact on GE, he says, and transformed the way business viewed HR.

In 1991, President George Bush nominated Clarence Thomas, a conservative African-American, for the U.S. Supreme Court. Although the choice was controversial, it proceeded through the Senate Judiciary Committee without incident.

The nomination took a dramatic turn, however, when it moved to the Senate floor. Anita Hill, a law professor at the University of Oklahoma, accused Thomas of sexual harassment. Hill, who had worked for Thomas when he was head of the EEOC, claimed that he had subjected her to discussions of sexual acts and pornographic films. Intense media attention surrounding Hill’s allegations and Thomas’s denials, focused a national spotlight on the issue of sexual harassment in the workplace. According to the EEOC, complaints of sexual harassment rose 23 percent in the first three weeks following the hearing, and sexual harassment cases more than doubled over the next nine years. Monetary awards to victims have risen sevenfold, from $7.7 million in 1991 to $54.6 million in 2000.

Today, sexual harassment is something that all American companies must deal with by educating workers, or by facing legal battles with employees who, thanks to Hill, no longer consider the subject taboo.

McGregor’s ideas about managerial behavior revolutionized the way corporations consider and value their employees, says Steve Brzezinski, academic dean and former director of management programs at Antioch College in Yellow Springs, Ohio. In his book The Human Side of Enterprise, McGregor challenged the prevailing belief that workers are inherently lazy. He formulated two models, Theory X and Theory Y, based on his examination of the way people behave in the workplace. Theory X assumes that all people dislike work and will avoid it unless they are controlled and threatened. Theory Y assumes that if workers are respected and involved in decision-making, they will be highly motivated.

“McGregor said each employee can make a vital contribution to the company, so we need to listen to them,” says Sean Creighton, director of student alumni services for Antioch. Otherwise, when you ignore and bully employees, they take on characteristics of the Theory X model because their jobs are unfulfilling.

Today, his Theory Y principle influences the design of personnel policies, affects the way companies conduct performance reviews, and shapes the idea of pay for performance. “He is the reason we use the term ‘human resources’ instead of personnel department,” says Brzezinski. “The idea that people are assets was unheard of before McGregor.”

If you buy a building, you can write it off over decades as an investment. If you invest in people, you can’t. In the 1960s and ’70s, companies such as EDS and the Atlanta Braves chose to write off training costs, but accounting principles have never officially recognized people as an investment.

HR has. For years, HR has been attaching numbers to what it does, from hiring time to employee productivity.

Recently, the challenge has been to prove not only whether HR is doing HR well, but also if it’s helping a business do well. One study, by Rutgers University professor Mark Huselid and others, found that the best companies have more jobs filled from within, invest more in training, offer more incentive pay, and have more HR professionals on staff.

Measuring HR is really about knowing what a business wants. If the company is trying to sell more Hershey bars, then bar sales per employee may be the best gauge of how well HR is doing its job. “The metrics that are going to work at Microsoft and Wal-Mart are different,” Huselid says. “The key is to recognize that people are an important part of creating value” for a company.

Frederick Herzberg’s theory contends that hygiene and motivation are the two issues that influence job satisfaction. Hygiene issues, such as salary, supervision, and working conditions don’t motivate employees, Herzberg says. They only minimize dissatisfaction. It is motivators such as respect and career advancement that create satisfaction, by fulfilling workers’ need for meaning and growth.

“People are happy if they are respected, not because they are paid well,” says Deborah Ulmer, associate professor at Virginia Commonwealth University. She predicts that Herzberg’s theories will have greater impact as Generations X and Y fill the workplace. “Money goes nowhere with them. If they aren’t respected, they’ll work somewhere else.”

Performance appraisals evolved with the notion of pay for performance and management by objectives, says Dick Grote, principal of Grote Consulting Corp., located in Addison, Texas. “Before that time, compensation was based on seniority and hierarchy.”

In the beginning, appraisals focused entirely on whether employees did their jobs as expected, he says. No link was made between performance and corporate goals or personal aspirations.

As the concept progressed, a dual approach was used, combining quantifiable records, such as attendance and productivity, with assessment of commitment, expertise, and attitude. In the 1970s, 360-degree feedback was adopted, incorporating opinions of peers, subordinates, and superiors for a complete view of a worker’s value.

This combination of quantifiable records and performance analysis was the norm for appraisals for decades, but it’s beginning to change, Grote says. Best-practice companies are adding assessment tools to the mix that rate employees on ethics and integrity. They are tying performance appraisals to the corporate mission statement and putting greater emphasis on accountability and differentiation.

“Organizations today shower rewards on a small number of people who perform above expectations,” Grote says, “and weed out those who aren’t pulling their weight.”

In the last century, wars stimulated enormous change in industrial development, technological advances, and workforce deployment.

The need for rapid weapons production in World War I led to studies of munitions workers at British factories, one of the first systematic examinations of work in an industrial setting. Because many women were working in factories for the first time, there was a need to analyze the training and working conditions for these women, says John Boudreau, professor of HR at Cornell University. “As a result, people in the military saw the impact of working conditions, such as the organization of the machinery, on productivity. This is stuff that we consider standard now.”

In World War II, the United States was forced to raise a very large army quickly, and military leaders developed a systematic way of selecting and placing personnel. Peter Dowling, a senior research affiliate at Cornell, says the U.S. military had to develop a variety of forms for information gathering, because some of those in the military couldn’t read or write. “It was quite an organizational feat, and many young officers who saw this in action went on to be managers in business after the war, and used the same selection and placement strategies in the workplace.”

The world wars created advances in training technology focused on piloting. In Vietnam, military managers also learned to build teams and manage human relations. “Soldiers and officers spent a good deal of time developing leadership skills,” he says. “Between World War II and the Vietnam War, management psychology emerged as an academic discipline.”

Workforce, January 2001, pp. 27-33 — Subscribe Now!