Daily Report for Executives provides in-depth coverage of unfolding legislative, regulatory, and judicial news from the nation’s capital, the states, and around the world. This daily news service...
Sept. 15 — A decline in unionization rates has led to lower wages for nonunion workers over the past three decades, according to a new report from the labor-affiliated Economic Policy Institute.
The analysis shows that nonunion wages are measurably higher in industry-regions with higher unionization rates, and that union decline has exacerbated wage inequality for both unionized and nonunionized workers.
That decline has been particularly felt by men in the private sector who lack a college education and don't belong to a labor union. For all nonunion private-sector men, EPI estimates this translates into an annual wage loss of $109 billion.
Previous explanations for wage trends focused on globalization, technological change, and the slowdown in Americans’ educational attainment. But wage declines in certain industries isolated from larger globalization and technology changes helps prove the effect of de-unionization, report co-author Jake Rosenfeld said.
“Otherwise, we wouldn't expect to see such dramatic effects in construction, transportation, and other domestic industries like grocery retailing. That union decline is so strongly correlated with the erosion of nonunion wages in these industries, I believe, is compelling evidence that unions should be viewed as a major driver of wage trends among nonunion workers,” he told Bloomberg BNA. Rosenfeld is associate professor of sociology at Washington University in St. Louis.
The report describes unions as affecting nonunion workers through resistance to offshoring and outsourcing, threat of unionization in wage negotiations, and upward wage adjustments. Increases in wage floors push other wages up in a ripple effect to maintain wage differentials between positions, the authors say.
Aparna Mathur, a resident scholar in economic policy with the conservative American Enterprise Institute, said the findings were insignificant compared with larger economic factors contributing to the decline in manufacturing jobs, such as globalization and offshoring.
“The report makes unions out to have a much bigger role than they do. They haven’t been a bulwark against these macroeconomic forces,” she told Bloomberg BNA.
She criticized the report for not focusing on job creation, which plays a much larger role than wage increases. While unions can negotiate higher wages, they can’t force employers to remain, keep jobs, or make companies more productive, Mathur said.
“If wages were so important, you would see more people flocking to unions. Instead, unions are declining, and companies are moving to areas with right-to-work laws and lower unionization rates,” she added.
To contact the reporter on this story: Llewellyn Hinkes-Jones in Washington at firstname.lastname@example.org
To contact the editor responsible for this story: Heather Rothman at email@example.com
Text of the report is available at http://src.bna.com/iCw.
Copyright © 2016 The Bureau of National Affairs, Inc. All Rights Reserved.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to firstname.lastname@example.org.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to email@example.com.
Put me on standing order
Notify me when new releases are available (no standing order will be created)