New Census Data Once Again Illustrate Importance of Unions to the Middle Class

Source: Keith Miller and David Madland, Center for American Progress, September 18, 2014

According to data released this week by the Census Bureau, America’s middle class continued to struggle to regain its economic footing in 2013 as its share of the nation’s total income remained effectively stagnant at historically low levels. Among the most frequently overlooked contributors to the middle class’ declining share of the economic pie is the weakening of labor unions, whose membership as a share of the national population also sat stagnant at a historic low in 2013. Strong unions are necessary to maintain a robust middle class, and if action is not taken to prevent their further erosion, the middle class’ share of America’s economic gains may continue to shrink as the nation becomes more unequal. … A number of forces are responsible for this unequal growth, including rapid globalization that undermined some middle-class wages and increasing returns to education that disproportionately increased the earnings of workers toward the top. When examining these trends, however, the role played by the decline of organized labor is often overlooked. Multiple academic studies have shown that unions help reduce economic inequality and that a significant share of the recent increase in inequality can be attributed to falling union membership. ….