Are Shrinking Unions Making Workers Poorer?

Source: Emma Green, Atlantic, July 24 2013

Growing income inequality is a fact, but its cause is unclear…. The causal chain is so tempting: As unions get smaller, collective bargaining gets weaker, worker wages go down, and evil profiteers cackle…. But other factors muddy the issue. Some experts argue that growing workforce automation, the global reach of the economy, and the need for high-skill labor has diminished the power of collective bargaining and cut into workers’ wages. If there’s cheap labor available in Bangladesh, why would an American company pay workers significantly more to do the same work? In the face of a cheap global labor pool, unions have less ammunition against employers, and U.S. workers also get paid less, regardless….

…Still, the fact remains that full-time workers who belong to unions make more money than those who don’t: On average, union members make about $200 more per week than their counterparts. This figure is influenced by lots of factors, including differences in average salary in regions with low levels of unionization. But even bearing that in mind, research shows that in “right to work” states, where employees cannot be required to pay union dues as a condition of their employment, workers get paid less than the rest of the country. That was true even when business grew in “right to work” states, indicating that weakening unions might help business owners, but it doesn’t do much for workers. (This Washington Post article gives a great overview of the economic effects of “right to work” legislation). …