Balance Sheet on Unionism

1
Balance Sheet on Unionism

• Unions Reduce wage inequality, increase
  industrial democracy and often raise
  productivity.in the political sphere, unions are
  an important voice for some of societys weakest
  and most vulnerable groups, as well as for their
  own members
• (Freeman and Medoff, 1984, p.5)

2
Dimensions of Unionism

• Democracy Civic Engagement and Political
  Representation
• Industrial Democracy Due Process at the
  Workplace
• Benefits Workers
• Security, Work-Family (Hours), Safety
• Enforcement of Workplace Protections Safety,
  Civil Rights, etc.
• Access to Unemployment Insurance, TAA, etc.
• Wages and Benefits

3
(No Transcript)
4
(No Transcript)
5
Unions and the Economy

• Output/Employment Small Impact
• Distribution Large Impact

6
Firm Performance

• Voice not Exit lower quits, turnover
• More training
• Voice/Security helps productivity
• Higher pay pushes technology, investment,
  management
• Plant closing/insolvency
• Industrial relations climate

7
Unions and Pay

• Goal Take labor out of competition by
  organizing market, either occupation or
  product/service.
• Impact Reduced Wage Inequality
• Equal Pay for similar work (including
  Race/Gender)
• Compress Intra-union Differentials
• Lessen gap between production and white-collar
  pay within firm
• Threat Effects raise nonunion wages

8
(No Transcript)
9
(No Transcript)
10
(No Transcript)
11
(No Transcript)
12
(No Transcript)
13
(No Transcript)
14
(No Transcript)
15
(No Transcript)
16
How Much Lower Inequality?

• Studies show declining unionism explains 20 of
  greater male wage inequality
• But that is too small.
• Threat effect on nonunion wages
• Benefits effect is larger
• Qualitatively, clearly bigger as go from setting
  standards to accepting them
• Part of Larger Social Scheme and Norms
• Transformed Workplaces Hotels vs. Meatpacking

17
Paul Krugman (February 22nd 2007)

• But the real reason to be favorable to unions
  is that we did not realize until we lost the
  union movement just how crucial a counterweight
  that was and a crucial piece of the political
  economy it really is.

18

• End

19
(No Transcript)
20
(No Transcript)
21
(No Transcript)