Because the manufacturing workforce has much higher rates of unionization than the overall labor force, the RTW advantage should be even more amplified in this sector. If compulsory unionism drives up labor compensation levels without a commensurate rise in productivity, manufacturers will seek more attractive regions for expansion, leaving non-RTW states with shrinking manufacturing payrolls.

Chart 5 illustrates that this clearly has been the case. In a period (1970-2000) where total manufacturing employment dropped by 5 percent nationwide, RTW states augmented their employment base by 1.5 percent annually. Over the 1970-2000 period, RTW states enjoyed a 1.7 percent growth advantage over non-RTW states, a significantly larger margin than they posted for total payroll employment.

While non-RTW states were cutting manufacturing payrolls by 2.3 million from 1970-2000, RTW states were increasing their blue-collar payrolls by 1.4 million. The RTW states' share of total manufacturing jobs (see Chart 6) rose from 25.4 percent in 1970 to 34.3 percent by 2000. Despite the loss of 875,000 U.S. manufacturing jobs over this period, all of the 21 RTW states registered a net gain in manufacturing payrolls.

Once a manufacturing powerhouse, Michigan fared poorly even in relation to other non-RTW states, losing over 100,000 manufacturing jobs from 1970 to 2000. Unlike most non-RTW states, however, Michigan's manufacturing payrolls did managed to grow during the 1990s (see Table III, Appendix I), ranking it 23rd in growth among all states.