Unions' Wage Effects

• In Event: Organizing and Union Strategy

Abstract

Substantial research finds that labor union membership, on average, raises and compresses pay for workers. But unions are organizations that vary widely in their strategy, capacity and effectiveness. Which unions effectively raise pay? We match administrative records on labor unions and collective bargaining to employer-linked worker wage reports. We find that the standard deviation of local union wage premiums is 21.4%. Comparing among union members in the same occupation, city, industry and year, specific union membership accounts for 5% of total pay variation. Smaller unions and historically AFL unions tend to carry a larger wage premium. In terms of strategy, we find suggestive evidence that unions spending more on organizing technology achieve higher wage premiums. Overall, these differences among unions reduce inequality: higher premium unions tend to represent workers in lower-paid jobs. The details of unions as organizations shape their effect on the wage distribution.

Authors

• Barry Eidlin, McGill University

• Emily Lemmerman, Massachusetts Institute of Technology

• Nathan Wilmers, Massachusetts Institute of Technology