Old story, new twist: The Labor Department is out this morning with its annual report on union membership in America, and once again, it shows a year-over-year drop in how many workers belong to labor unions.

Private-sector union membership has been declining for years. Now public-sector union membership is falling, too. (BLS)

That’s the old story. Union membership has declined steadily over the past three decades. About 18 million American workers were unionized in 1973, nearly a quarter of the total workforce. In 2012 there were 14.3 million union workers – just over 11 percent of the total workforce, and a drop of 400,000 people from the previous year.

The new twist is what drove the decline in 2012, which is really a story about how unions have changed. The big culprit for last year’s drop doesn’t appear to be outsourcing (though union factory employment has fallen since the recession, while non-union employment has risen). The issue was austerity.

Specifically, state and local governments laid off a lot of workers last year to help balance their budgets. That means they let a lot of union members go. The Labor Department reports that more than half of all U.S. union members work in the public sector; government is nearly 36 percent unionized, while the private-sector union membership rate is less than 7 percent. (Last year’s stats suggest that some Republican governors’ efforts to reduce unionization in their state public sectors is working – Wisconsin posted a 2.1 percentage point drop in union membership from 2011 to 2012.)

I asked several union officials to react to a preliminary estimate of these figures this month. Roundly, the officials said the drop in membership rates reflected a concerted attack on organized labor and an austerity hit to the economy that affects everyone, not just folks with a union card. They also struck some optimism about their efforts to reverse the trend, including moves to organize Latinos and other fast-growing demographic groups.

"The economic crisis – and the politicians who took advantage of it for their own anti-worker purposes – had a negative impact,” said Lee Saunders, president of the American Federation of State, County and Municipal Employees. “But, we’ve pulled together to focus sharply on organizing new workers – AFSCME organized 50,000 new workers during the past two years.”

Some unions went relatively unscathed last year, such as the International Association of Fire Fighters, which lost fewer than 2,000 members in part thanks to federal help for local fire departments. But the IAFF’s general president, Harold Schaitberger, said “the resolve is even stronger” among his members to help other public-sector workers fight budget cuts or efforts to pass right-to-work laws in states.

“I think everybody recognizes that if we’re losing tens of thousands of teachers, even if first responders are fortunate enough not to get caught up in it, this is a battle for all of us,” Schaitberger said. “Because if it’s teachers today, it’s firefighters tomorrow.”

Tomorrow’s workforce appears to be labor’s biggest challenge: The union membership rate for workers aged 55 to 64 is 15 percent. For workers ages 25 to 34, it’s less than 10 percent.