"But economists argue that labors original idea has become irrelevant. They point to the natural decline of trade unions in the 20th century as the indicator that businesses have met workers expectations to a large extent."
There are less trade unions because there is less trade i.e. industry. The retail establishment (service sector) has become the dominant force in the economies of this nation. If they don't have unions like the UFCW that is because they haven't organized for one so far not because they don't need one.
"So what about the capitalist argument: The market will bare."
It is not an abstraction like "the market" but rather the marketeers, the corporate elite, who decide.