Story by Rob Rombouts
Across the US and Canada, the share of workers belonging to a labour union has dropped dramatically, and this has resulted in significant loss of wages for non-unionized workers, according to new research.
New research from Patrick Denice, assistant professor of Sociology at Western University, and his colleague Jake Rosenfeld at Washington University in St. Louis, entitled Unions and Nonunion Pay in the United States, 1977-2015, has investigated the lost wage potential among non-union workers in the private sector due to a decrease in unionization.
“We tend to think of unions as self-interested, which is true to some extent,” said Denice, “but even if you aren’t in a union, you benefit from a strong union environment.”
The pair looked at the wages of non-union, private sector workers in occupations and regions with high and low union rates; that is, they compared wages of people working in the same types of jobs, in similar places, with different rates of unionization. Accounting for the impact of automation, de-industrialization, and off-shoring, their findings show that wages are higher among non-unionized workers in places where unions are stronger.
There are a number of reasons why strong unions would benefit unorganized workers. If there is a unionized workplace in an area, Denice said, other non-unionized local employers might increase their own wages and benefits in order to compete for workers and to discourage potential union organization in their own workplace.
In the 1970s, one in three, or around 33%, of private sector workers in the United States were members of a union; the current rate is approximately 6.7%. Since the 1970s, changes in how employers view and deal with unions, as well as changes in legislation, including states’ passage of “right-to-work” laws, have contributed to the weakening of unions. Denice said that de-industrialization has also had an effect, as organized labour’s concentration in the manufacturing sector left unions particularly vulnerable to offshoring, automation, and the closing of factories.
“If the private sector labour movement hadn’t declined from its late-1970s levels, non-union men working full-time would be making about $3,000 more annually, on average, and women would be making just under $1,000 more each year,” said Denice.
The gender disparity is due, in large part, to the fact that jobs predominantly filled by men were more heavily unionized than those predominantly filled by women.
The results, Denice said, show that even non-unionized workers have a stake in the health of the labour movement. In August 2018, voters in Missouri struck down the state’s proposed right-to-work legislation, suggesting that people may see the benefit of unions, even if they are not part of a union themselves.
“Even relatively moderate rates of unionization can have benefits for non-union workers,” said Denice.
Policy makers who are interested in reducing pay inequality and closing the gap between the highest and lowest earners should see unions as a way to raise those nearer the bottom, regardless of whether those specific workers are unionized or not, said Denice.
Looking to the future, Denice said that to the extent that union rates are falling in other places, they may see a decline in wages.
“The US is an outlying case of severe union decline, particularly in its private sector, but there are similar patterns playing out elsewhere.”