Private sector unions: The myth of decline

Conventional wisdom holds that private sector labor unions are in “crisis” due to the loss of millions of members over the past two decades which has resulted in a dramatic decline in their economic viability and political power. Financial data for selected years between 1960 and 1987 are analyzed to show that, contrary to prevailing opinion, private sector unions are financially prosperous despite membership erosion. Evidence is also presented which indicates that union political efforts and influence have increased rather than declined in recent years. Resources have been allocated to political advocacy to obtain a more favorable public policy environment for labor organizations and to achieve gains that have eluded unions in collective bargaining. The author gratefully acknowledges the assistance of Ms. Sybil Jones at the National Institute for Labor Relations Research.     

Strangers to Their Own Class?

The central question addressed is whether constitutional democracy, institutionalized opposition, and radical leadership tend to narrow the vertical social distance between the officers and members of industrial unions. The empirical analysis utilizes data on the Congress of Industrial Organizations unions during the late 1940s. The argument is that both union democracy and radicalism tend to sustain a close identification between workers and their leaders, to enhance their class solidarity, and to minimize the split between them. The analysis shows that officers' salaries and the income differential between their salaries and the workers' wages were far smaller in the democratic unions and in those in the Communist camp than in the oligarchical unions and those in the anti-Communist camp.     

COMPETITION AND TEACHER PAY

Competition‐based school reform could have a significant impact on teacher earnings. If school districts behave as typical oligopsonists, then increased competition could lead to higher salaries. However, if teachers receive a share of the economic rents generated by the monopoly power of school districts, then increased competition could lower teacher salaries. This study uses panel data from 670 Texas school districts and more than 335,000 teachers to examine the relationship between school competition and teacher pay. The analysis suggests that an increase in competition results in higher wages for most teachers but lower wages for teachers in relatively concentrated markets. (JEL I2, J3)     

UNIONS, PLANTS, JOBS, AND WORKERS

The relationship between unions and their members is an important, yet neglected, subject in recent studies of the sociology of work. This study develops and tests a theory of union satisfaction and participation that combines recent research in the sociology of work with previous explanations of union satisfaction and participation provided by industrial relations researchers, in an attempt to understand the relationship between unions, plants, jobs, and workers in U.S. manufacturing industries. This theory predicts that union members will be satisfied with their unions and participate more in them if there are extensive ties between workers, employers, and unions. These ties stem from the focus of labor/management relations in particular, and class struggles in general, on market outcomes and the historical linkage of union membership with employment in the United States. The theory also predicts that unions them-selves act as ties to specific work settings and that union participation is a forum for voicing dissatisfaction with specific characteristics of workers' jobs. Testing these predictions is complicated by contradictory nature of the structure and organization of work in advanced industrial societies. The analysis provides qualified support for this theory, with data drawn from more unions, plants, and union members than have been used to date. In addition to discussing modifications to the theory and analysis presented here, the study includes a discussion of its implications for the future of unionization and the organization of work, in light of declines in union membership, increased efforts to decertify unions and resist union organizing efforts, and deindustrialization in the United States.     

Unionization decisions of members and nonmembers of an employee association

The determinants of intent to unionize were investigated using the responses of 405 employees of a large public university, 243 of whom were members of an employee association. Members and nonmembers indicated significantly different levels of union vote intent, general beliefs, specific beliefs, and normative pressures. They also used a different union vote decision model. General beliefs about unions appear to play a significantly greater role in unionization decision of nonmembers. On the other hand, while considering unionization, specific beliefs about unions were significantly more important for association members. Association members were less likely to vote for unionization.     

Judging unions’ future using a historical perspective: the public policy choice between competition and unionization

VII. Conclusion In discussing the future of private sector union membership one needs to evaluate the early period of union ascendancy (1930s through the early 1950s) as well as the past few decades when unions have been in decline. We know trends currently in place are unfavorable to unions. What conditions would be favorable? When the earlier period of union growth us studied, two factors become prominent — the competitiveness of the labor market and the ability of unions to fullfill their major goal of either extracting economic rents or remedying market failures that result in exploitive employment relationship.     

Compensation,employment, and the political activity of public employee unions

It has been hypothesized that because public employee unions are politically influential, they have a bargaining advanatage over their private-sector counterparts. Previous studies, however, have not directly measured the political activities of public employee unions and have instead usually used some type of unionization proxy. This paper uses unpublished data from the International City Managers Association to develop a more direct measure of union political activity. Using this measure, it is found that an increase in union political activity leads to higher compensation and employment for public employee union members.     

A spatial study of teachers’ salaries in Pennsylvania school districts

I explore the relationship among teacher salaries across Pennsylvania school districts. Using techniques developed in spatial econometrics, I find that the error terms in a salary regression are spatially correlated, suggesting evidence of omitted labor market factors. I also find evidence that salaries in nearby, financially similar districts directly influence teacher salaries in a particular district, which is evidence of pattern bargaining or more informal social comparisons across districts. Econometric specifications that ignore these factors overstate the influence of own-district variables, such as economic indicators, on salary. I thank colleagues Linda Babcock and John Engberg for very valuable contributions and for use of their data. Thanks also to Wil Gorr, who helped with some of the GIS aspects of this research. A National Science Foundation grant supported data collection.     

Perceptions of union power,service, and confidence in labor leaders: A study of member and nonmember differences

Attitudes toward specific aspects of unionization held by the subjects of large national samples of the U.S. work force (the1977 Quality of Employment Survey) and the general population (the1972–1978 General Social Surveys) are examined in two separate analyses. Comparisons of the attitudes held by union members and nonmembers are made on specific dimensions of union power and service and confidence in union leaders. Nonmembers are found to have stronger perceptions that unions are influential in running the country and that unions are stronger than employers. Conversely, union members have stronger perceptions that unions offer protection, job security, improve wages and conditions of work, are worth their dues, and have greater confidence in union leaders. Discriminant analysis of data over a five-year period also revealed that union members have a stable higher confidence level in union leaders than nonmembers. Explanations for such union member and nonmember differences are hypothesized. The authors wish to acknowledge the assistance of Brent Schooley. An earlier version of this paper was presented at the Western Academy of Management meetings at Monterey, California, 1981.     

Outsourcing and union power

The outsourcing of union work and jobs either diffuses or diminishes union membership, depending on perspective and situation. The correlation of trends in union membership to trends in union power, while less than perfect, has until recently been relatively strong over the past sixteen years. The fact that as diverse a sample of unions as AFSCME, SEIU, and UAW have chosen to make outsourcing a prominent labor/public relations issue suggests that the correlation continues to be perceived by the union movement to be significant, notwithstanding the efforts of the “new” leadership of the AFL-CIO to break that link with respect to union political power by “taxing” member unions and their members to contribute both money and militancy to the 1996 election cycle. Although outsourcing may lead only to the diffusion of union membership either within or between unions, as opposed to the diminution of union membership, this fact has not received a great deal of attention. The net effect on total union membership of outsourcing from one union employer to another union employer is unclear, although the effect on the membership of the union at the outsourcing employer is not. The redistribution of membership within a union as a result of outsourcing is likely to have little immediate impact on union power. However, as even the best case scenario presented above suggests, it may have significant long-run deleterious effects on union bargaining power by taking labor out of a sheltered market and putting it into potentially competitive market. This is particularly likely to be the case when outsourcing (1) places the outsourced work into a different industry or wage contour and (2) creates the possibility of moving from sole-source to multiplesource supplier arrangements. The redistribution of membership between unions as a result of outsourcing is unlikely to have a major impact on union power broadly defined. It can have, however, serious deleterious effects in terms of the power of an individual union, as suggested in my “competitive case” scenario. The fact that one union’s losses due to outsourcing may be another union’s gain is of little consolation to the losing union. That act, in and of itself, may make the threat of outsourcing a potential union “Achilles heel” at the bargaining table by placing it into competition with some other, perhaps unknown, union as well as possibly nonunion competition. The most obvious threat to union power comes from outsourcing that diminishes union membership overall by transferring jobs from union to nonunion employers. The willingness and ability of employers to move work/jobs entirely out of the orbit of union control constitutes, in terms of power and particularly union bargaining power, a revisitation of the phenomenon of the “runaway shop.” It may also be viewed as a proactive form of hiring permanent replacements for (potentially) striking workers. The union options in dealing with such a challenge are to endeavor to preclude outsourcing through legislation or collective bargaining or to chase the work by organizing the unorganized, hopefully with the help of the unionized outsourcing employer. Neither option may be easy, but as the 1996 auto industry negotiations suggest, the former may be less difficult than the latter. The possibility that outsourcing from union to nonunion employer may provide unions with the power to organize from the top (outsourcer) down (outsourcee) cannot be entirely ignored as the issue of supplier “neutrality” reportedly was raised in the 1996 auto negotiations. The adverse effects of outsourcing on union political and financial power, by virtue of its impact on the level or distribution of union membership, can and may well be offset by an increase in union activism—as measured by dues levels, merger activity, organizing commitment, and political action. The adverse effects of outsourcing on union bargaining power are more problematical from the union standpoint. The effect of outsourcing, whatever its rationale or scenario, appears to be to put union labor back into competition. Thus, outsourcing constitutes yet another challenge to the labor movement in its ongoing and seemingly increasingly unsuccessful battle to take and keep U.S. union labor out of competition by proving itself able and willing to organize to the extent of the market and standardizing wages in that market.     

Sustaining and Developing Women's Trade Union Activism: A Gendered Project?

Against the background of heavy membership decline, the increasing importance of women as a source of members for unions and union efforts to attract women into membership, this paper explores the nature of women's union activism. The focus is on why women stay active in unions. The paper employs Klandermans' model as a framework for examining senior union women's activism. This study suggests that the model is gendered in that women's experiences and perceptions of trade unions are highly gender specific and further that their union activities are underpinned by a feminist paradigm. The women in the study expressed a strong desire to ensure that the union works for women, indicative of the gendered nature of their commitment to the union. They revealed gendered bargaining priorities and thus gendered perceptions of union instrumentality. Their social integration within the union is shown to be highly or partially contingent upon, formal and informal women's support networks.     

Monopsony and teachers’ salaries in Georgia

Does monopsony power in the labor market for teachers affect teachers’ salaries? Prior studies have found mixed evidence of monopsony effects in teacher labor markets. A major problem has been controlling for union wage effects, which potentially mask the wage-depressing effects of monopsony. We use data from the state of Georgia, one of the few states in the United States where no teacher bargaining takes place. We detect no evidence of lower average teacher salaries in less competitive labor markets. We also find limited evidence that salaries of beginning teachers may be about two percent lower in less competitive labor markets, but our findings are not robust with respect to our various measures of monopsony and labor market boundaries. We conclude that even in the absence of unions the effect of monopsony on teachers’ salaries appears to be very small.     

Financial and political resources of nine major public sector unions in the 1980s

Current research offers two potentially competing perspectives on union strength: membership and financial/political resources. We update and broaden the research on the financial and political resources of nine major public sector unions in the U.S. by reporting these unions’ financial assets, net worth, revenues, and political action committee (PAC) receipts during the 1980s and the early 1990s. We find that unions may expand their financial and political resources even though membership levels stagnate or decline. Overall, the unions have amassed larger asset bases, even though some have actually lost members. On a per member basis, federal executive branch unions do not appear as financially weak as the level of their financial resources suggests. Postal unions as a group are clearly the strongest in terms of per member financial and political resources. Federal executive branch unions have experienced a striking reduction in their PAC activity, while the postal and the state and local union PACs have grown substantially. Our analysis indicates that union membership may not adequately measure union strength.     

Formalization,collectivization, and the demand for union services

Formalized collective bargaining rather than individual employer-employee negotiation is the fundamental characteristic of a unionized labor market. Formalization involves the substitution of rules for employer discretion. Collectivization substitutes simultaneous decision making on behalf of all workers in a unit for a set of individual employee decisions. Formalization and collectivization are present in nonunion as well as union labor markets and their extent varies within as well as between these two sectors. In particular, individuals may negotiate where they belong in a union environment, and the presence of rules invites negotiation over their interpretation. Nevertheless, because formalization and collectivization are obvious concomitants of trade union organization, their costs to both employers and employees should explain the probability of union organization, as well as the incidence of such antecedents of the modern trade union as the Italian padrone who acted as foreman, pay-master, and employment agency for newly-arrived immigrants to the United States; and the Indianjamdar, a construction industry recruiter-foreman. Our occasional observations of union-induced costreductions may appear to counter the implicit assumption in much of the trade union literature that unions always induce suboptimal combinations of factor inputs and factor payments (nonunion firms could choose union-induced parameters on their own and do not). Because these cost reductions may be accompanied by increased costs imposed by unions, however, the cost reductions discussed below imply nothing about overall effects of unions on employers or employees. I wish to thank John Pencavel for helpful comments on earlier versions of this paper. For further analysis of these points, see Flanders (1968). See Epstein and Monat (1973) for a discussion of the services provided by labor contractors.     

Union Organizing and Labor Outreach in the Contemporary United States

Despite their long decline, labor unions increasingly find themselves in the news. From the spirited debate over income inequality, to fights over minimum wage and the unlikely mobilization of fast food workers at the very bottom of the American labor market, labor issues are of great public interest. In this article, I review scholarship on contemporary union organizing and outreach activity. This work suggests that while innovative organizing and outreach strategies, sometimes lumped together under the rubric of “social movement unionism” and “alt‐labor,” are demonstrated to be effective in advancing union causes, only a handful of unions appear to have the will and resources to utilize them. Moreover, while the implementation of new organizing and outreach strategies has been uneven and has not boosted union membership nationally, organized resistance to unions, from court rooms to state legislatures, has increased substantially.     

Agency costs,property rights,and the evolution of labor unions

Collective bargaining requires that an agent represent workers. This paper examines the implications for the trade union movement of the resulting agency costs. Without transferable rights in the union, union members lack the means and incentive to bring forth the innovative agent controls common to the modern corporation. Considerations of the bargaining strengths of employers and employees, each represented by an agent, provide an explanation of the simultaneous decline of private sector union membership (corporate share holders have been more successful at lowering agency costs) and growth of public sector union representation (where the union official, a “double agent,” serves the interest of both employee and bureaucratic employer). The authors acknowledge the helpful remarks Donald L. Martin whose earlier research on property rights in unions inspired this effort. Don Bellante’s work was supported by a grant from the Research Committee of the College of Business Administration, University of South Florida.     

Tax-funded unionism: The unemployment connection

Labor unions are widely regarded as private organizations which finance their activities exclusively through revenues collected from members and others who are covered by collective bargaining agreements. In reality, however, U.S. unions receive millions of dollars each year through grants and contracts from federal, state, and local governments for a variety of purposes, including aid to the unemployed; these funds are used (sometimes illegally) to finance union operations, including political activities. This article briefly explores the phenomenon of tax-funded unionism.     

Labor unions: Victims of their political success?

Conclusion A glimpse of the future of private sector unions may be gleaned from examining the past. Union densities have declined for nearly half a century, and structural and demographic changes, global competition, and various other factors have caused much of this decline. However, as recognized by early union leaders, legislative successes that diminish the role of collective bargaining naturally contribute to a diminished role for unions in the workplace and union decline must inevitably follow. We thank Bruce Kaufman for valuable comments and suggestions on an earlier draft of this paper.     

Collective bargaining and the determinants of teachers’ salaries

Using a national sample of public high schools, we find that bargaining spillovers play an important role in teachers’ labor markets. The spillover variable consistently indicates a larger bargaining effect than does the collective bargaining coverage dummy. We estimate that a 10 percent increase in the state density of teachers’ unions increases the highest teacher salaries by 2.6 percent and the lowest by 0.2 percent. Consistent with prior research, teacher union density was most strongly associated with highest salaries and had a nonsignificant positive association with lowest salaries. Teachers’ unions also affect the structural determinants of teachers’ salaries, offering some additional evidence supporting a median voter model. The proportion of unionized teachers with higher levels of education and experience (i.e., the highest paid) is positively related to highest salaries. Finally, our results confirm the importance of demand factors in teacher wage determination. The authors thank Shawn Windsor for his excellent research assistance and an anonymous referee for helpful comments on a previous draft of this paper. The Inter-University Consortium for Political and Social Research provided the primary data set used in this paper. The U.S. Department of Education, National Center for Education Statistics compiled the original data set. We gratefully acknoledge the assistance of Eric Hanushek and Lori Taylor who also provided data used herein. This research was funded in part by a grant from the McGill Faculty of Management Research Committee.     

Union rent seeking and import competition

conclusion We empirically evaluate two issues: (1) how the union rent seeking responds to import competition and (2) whether union bargaining power, as proxied by the proportion of the labor force in an industry that is unionized, moderates the impact of import com-petition on union wage differentials. Unlike other studies, our emphasis is on the influ-ence of import competition on union rent seeking, rather than on union wages per se. Our primary results indicate that while import competition negatively and significantly affects union rent seeking, the extent of unionization does not substantially influence the impact of import competition on the union wage differentials. This is a somewhat surprising result since the literature suggests that union wages are greater in the pres-ence of stronger unions.