The Benefits of Collective Bargaining: An Antidote to Wage Decline and Inequality

Source: Economic Policy Institute, Fact Sheet, March 17, 2015

Wages have been stagnant for a generation despite sizable increases in overall productivity, incomes, and wealth. For instance, our nation’s output of goods and services per hour worked (productivity, net of depreciation) grew 64 percent from 1979 to 2014, while the inflation-adjusted hourly wage of the typical worker rose by just 6 percent. The single largest factor suppressing wage growth for middle-wage workers has been the erosion of collective bargaining.
– The decline of collective bargaining has affected nonunion workers in industries or occupations that previously had extensive collective bargaining because their employers no longer raise wages toward the union-set standard as union membership rates decline.
– The decline of collective bargaining through its impact on union and nonunion workers can explain one-third of the rise of wage inequality among men since 1979, and one-fifth among women…..