CHICAGO (Reuters) - U.S. labor unions, having helped Barack Obama win the presidency, entertain high hopes he will enact their agenda to bolster their negotiating power with employers and increase their numbers after decades of decline.

Unions have “an unprecedented amount of leverage” after turning out white middle-class voters for Obama in battleground industrial states like Pennsylvania and Ohio that he won in Tuesday’s election but had lost in the Democratic nominating primaries, said University of Illinois-Chicago labor expert Robert Bruno.

“American workers won this election,” said Anna Burger, chairman of the labor coalition “Change to Win” at a news conference this week in Washington. “The mandate has never been so overwhelming for a progressive economic agenda.”

A cornerstone of labor’s agenda is passage of the Employee Free Choice Act that unions argue restores balance to its negotiations with employers, but is described as “Armageddon” by a leading business group.

Burger said she expected the measure and other parts of the unions’ agenda to be addressed in the first 100 days of the Obama administration, which takes office on January 20.

Other labor leaders sought to dampen the notion they were owed something by the incoming administration.

“That is not the way Obama works,” said Bill Samuel, legislative director of the AFL-CIO, America’s biggest labor organization.

“We are part of the conversation about the economy right now in a way that we weren’t when the Republicans were in charge ... we see the world in the same way (as Democratic leaders),” Samuel said.

BATTLE EXPECTED OVER LABOR LEGISLATION

A battle is shaping up in the U.S. Senate over the Employee Free Choice Act. Its two major provisions would let prospective members sign union cards instead of waiting to hold secret ballot elections to unionize workers at a company, and call for a government arbitrator if a newly created union and the employer did not reach a contract within 120 days.

One-third of the time that a union succeeds in organizing a company’s workers, it never reaches a contract with the employer, and the union often disbands at the company.

Both labor and business say passage of the law could mean unionization rates will soar. Unions have arrested a decades-long decline and have roughly 13 million members, or just 7.5 percent of the nongovernmental work force. That is down sharply from the mid-1950s when U.S. union membership reached 36 percent of the labor force.

Democrats Obama and Vice President-elect Joe Biden have both emphasized their support for the legislation.

Their Republican opponent, John McCain, called the measure “a threat to democracy” and warned it would hurt small business and erode workers’ rights to vote in secret on joining a union.

Opponents say the law is unbalanced as written and will lead to workers being coerced into joining unions and permit arbitrators to undermine employers’ control by setting wages, benefits and work rules.

“This bill is Armageddon for the employer community,” said Randy Johnson of the U.S. Chamber of Commerce. “(It) can artificially drive up wages and create work rules that remove flexibility.”

“We’ll have wage-led inflation for the first time ever in this country if this happens and I don’t know if this economy can stand it,” said William Adams, who helps employers plot strategy.

Adams said unions could make unreasonable demands then wait for the arbitrator to split the difference with the employer’s offer. Arbitrators can ignore outrageous demands, supporters say.

The act was introduced five years ago and won approval in the U.S. House of Representatives in March 2007, but Republican opposition has prevented it from coming up for a vote in the Senate.

The big question is if backers will have the 60 or more Senate votes to end an expected Republican-led filibuster. Democrats in Tuesday’s election boosted their majority in the 100-seat chamber to at least 57, but trail in at least three undecided races.

Also on the union wish list is a proposed $100 billion infrastructure rebuilding program the Laborers’ union said would create more than 1 million jobs.

Construction jobs have been particularly hard-hit in the current downturn, losing 657,000 jobs since the start of 2007. Overall, the U.S. economy has lost 1.2 million jobs this year -- many of them union jobs in autos and other industries -- including the 240,000 drop in October payrolls reported on Friday.