Trade Union Decline and Union Wage Effects in Australia

Union density in Australia fell precipitously in the 1990s. This study investigates how union wage effects may have changed as a result. The findings from 1993 data suggest that union/nonunion wage differentials were very small, especially among workers in high-density industries. By 2001 the overall union wage effect had increased significantly; however, the union/nonunion wage differential was no longer correlated with union density at the industry level.     

Measurement of Compensation: Union and Nonunion

For many purposes, the economic impact of unions is better measured by the proportion of union wages in total payrolls rather than by the proportion of unionized employees in the overall workforce. We use recently available Current Population Survey data to generate estimates of the former. We also show that published data from the Survey on median union and nonunion wages produce substantially larger estimates of the union 1 nonunion wage differential than figures based on mean wages. Finally, we note that the Bureau of Labor Statistics' Employment Cost Index gives undue weight to the union sector because of its Laspeyres methodology.     

Who Fared Better? The Fortunes of Performance Pay and Fixed Pay Workers through Recession

Using the Annual Survey of Hours and Earnings, we explore whether the fortunes of employees paid for performance differ from those of fixed pay workers during recession. Only in the bottom quintile of the wage distribution were performance pay employees more likely to experience greater falls in real wages than fixed pay employees. Accounting for fixed unobserved worker characteristics suggests that this was not due to the wage‐setting mechanism itself, but that other factors are likely to be at play. While across most of the earnings distribution there was little evidence of greater wage flexibility among performance pay employees, they did have longer job tenure than fixed pay employees over the recession.     

Satisfaction, Market Wages, & Labor Relations: An Airline Study

We use arguments from economics and industrial relations to help examine aspects of job satisfaction in the context of a changing industrial relations scene. Market comparisons and wage contours provide the strongest predictors of pay satisfaction. Results also suggest that workers in the "B" tier of two-tier wage plans are in fact more satisfied with pay and that overall, workers are more satisfied with less supervision and more control over their work.     

Managerial Responsiveness to Union and Nonunion Worker Voice in Britain

Over the last two decades, there has been a switch in British workplaces away from union voice and representative worker voice more generally toward direct employee involvement and nonunion representative forms of voice. This article assesses the implications of this switch for the effectiveness of worker voice, as measured by employee perceptions of managerial responsiveness. In general, perceptions of managerial responsiveness are better among employees with nonunion voice than they are among employees with union voice.     

The Effect of Prevailing Wage Regulations on Contractor Bid Participation and Behavior: A Comparison of Palo Alto,California with Four Nearby Prevailing Wage Municipalities

This sample of bids by union and nonunion contractors on and off municipal prevailing wage projects in the San Francisco Bay area of California provides the first empirical evidence examining the effects of prevailing wage regulations on contractor participation and bidding behavior. The data show that the presence of prevailing wage regulations does not decrease the number of bidders nor alter the bidding behavior of contractors relative to the engineer's estimate of the value of the project. Furthermore, in this heavily unionized area during an upswing in the business cycle, the presence of prevailing wage regulations did not discourage the participation of nonunion contractors nor reduce their chances of winning work.     

Strategic Jobs and Wage Structure in the Steel Industry: 1910–1930

The concept of strategic occupations is used to explain individualistic bargaining power during the nonunion era of the U.S. steel industry. It is hypothesized that integrative technical change homogenized the wage structure, but job categories associated with strategic work resisted this pattern. The results show that the degree of wage homogenization corresponded to the degree of technical diffusion in given steel industry departments. Moreover, strategic job categories did resist the pattern of wage homogenization.     

Race Discrimination and Union Voice

This work reports patterns of complaints about racial discrimination that appear consistent with the social mechanism of "voice." Black union members are subject to less racial discrimination but are no less likely to identify themselves as victims of discrimination than black nonunion members. Indeed, black women members are more likely to claim discrimination than their nonunion counterparts. White union members are much more likely to identify themselves as victims of discrimination than non-members even controlling for the erosion of typical racial wage differentials. These findings remain robust across a variety of specifications and suggest that there is something unique about the union setting that encourages complaints.     

Does Wage Rank Affect Employees’ Well‐being?

How do workers make wage comparisons? Both an experimental study and an analysis of 16,000 British employees are reported. Satisfaction and well‐being levels are shown to depend on more than simple relative pay. They depend upon the ordinal rank of an individual's wage within a comparison group. “Rank” itself thus seems to matter to human beings. Moreover, consistent with psychological theory, quits in a workplace are correlated with pay distribution skewness.     

Does Individualizing the Labor Contract Hurt Women?

The twenty‐first century has been marked by a retreat of the collective bargaining rights of public employees throughout the United States. This study exploits the variation in legal environments resulting from these reforms to estimate the causal impact of different collective bargaining policies on public employee compensation. Using data from the American Community Survey, results show a modest wage penalty at the aggregate level for employees covered by constraints on collective bargaining. However, this wage penalty is differential and is concentrated on women in all but one case—a legal environment in which collective bargaining over wages has either been prohibited or directly constricted, allowing governments to periodically institute wage freezes and caps on raises for public employees. In this case, a pre‐existing wage gap in which men earned more than women is disappearing as male and female earnings converge at a lower wage. The paper suggests that the long‐term effects of restricting collective bargaining occur through the individualization of the labor contract and should be examined along individual‐level characteristics, such as gender.     

Job Satisfaction in Britain

Little recent empirical work in economics or industrial relations has examined job satisfaction, despite its demonstrated correlation with labour market behaviour such as quits, absenteeism and productivity. This paper uses information from a study of 5000 British employees to investigate the relationship between three measures of job satisfaction and a wide range of individual and job characteristics. Notably, men, workers in their thirties, the well-educated, those working longer hours and workers in larger establishments have lower levels of job satisfaction. The estimated job satisfaction equations are used to calculate a measure of the shadow wage and to provide some evidence that is consistent with the existence of non-compensating differentials in the industry and occupational wage structure.     

The role of the workplace in ethnic wage differentials

Using linked employer–employee data for Britain, we examine ethnic wage differentials among full-time employees. We find substantial ethnic segregation across workplaces. However, this inter-workplace segregation does not contribute to the aggregate wage penalty in Britain. Instead, most of the ethnic wage gap exists within the workplace, between observationally-equivalent co-workers. Lower pay satisfaction and higher levels of skill mismatch among ethnic minority workers are consistent with discrimination in wage-setting on the part of employers. The presence of recognized trade unions and the use of job evaluation schemes within the workplace are associated with a smaller ethnic wage gap. These findings indicate that more attention should be placed on ensuring fairness in wage determination.     

Twin Tracks—Employee Representation at Eurotunnel Revisited

The introduction of the European Directive on Information and Consultation and the recent implementation of the Information and Consultation of Employees (ICE) Regulations into United Kingdom (UK) law have increased the focus on workplace representation arrangements. This paper examines the interplay between nonunion and union representative arrangements at Eurotunnel (UK) and assesses their effectiveness in representing the needs of employees over a 5‐year period. Importantly, the paper also examines the opportunities and challenges of both nonunion representation (NER) and union voice arrangements. The findings show that the effectiveness of nonunion structures as bodies representing the interests of employees in filling the lack of representation is questionable. However, union recognition through an employer–union partnership agreement has also raised important issues regarding the effectiveness, impact, and legitimacy of unions at Eurotunnel. The main implication of this research is that the existence of a mechanism—union or nonunion—for communication between management and employees at the workplace may not be a sufficient condition for effective representation of employee interests. In addition, while trade unions may provide greater voice than nonunion arrangements (thus the reluctance of management to accept such voice arrangements), the strength of voice is dependent on the legitimacy and effectiveness of trade unions in representing employees’ interests at the workplace. And that in turn depends on the union being perceived by the workforce as both representative and able to act independently. If the union cannot, it will not meet the needs of either employees or management—and could run the risk of being supplanted under the provisions of the new EU Directive on Information and Consultation with tougher requirements for compliance in terms of procedures for consultation and information disclosure.     

The Wage–Health Insurance Trade‐off and Worker Selection: Evidence From the Medical Expenditure Panel Survey 1997 to 2006

Key provisions within healthcare reform will likely further increase the cost of employer‐sponsored insurance. Theory suggests that workers pay for their health insurance through a wage offset. We investigate this issue using data from the Medical Expenditure Panel Survey. GMM estimates aimed at correcting for endogenous worker mobility reveal evidence of a trade‐off for workers who are offered health insurance as the only fringe benefit. On the other hand, employees in establishments with a more comprehensive set of benefits enjoy higher wages relative to employees in establishments that offer no benefits. Health also affects the wage–health insurance trade‐off.     

The Gender Pay Gap for Private‐Sector Employees in Canada and Britain

The gender earnings differentials for private‐sector employees in Britain and Canada are similar, substantial and significant. Using linked employer–employee data, we show that women are more likely to be employed in low‐wage workplaces than men in both counties. After accounting for the workplace, women continue to earn less than comparable men. Although men and women face a more equal pay structure within their workplace than they do across workplaces, a substantial portion of the gender pay gap in both countries remains unexplained by the individual characteristics or workplace effects considered in this study.     

Public- and Private-Sector Wage Differentials in Canada Revisited

Using a variety of techniques, we estimate the wage premium for federal, provincial, and municipal public-sector employees in Canada. We find that females in the public sector are paid a wage premium, with federal government workers enjoying the highest rents, followed by local and provincial public-sector employees. Estimates for males suggest that rent payments are comparably less, but results are inconclusive.     

Britain and BrExit: Is the UK more attractive to supervisors? An analysis of the wage premium to supervision across the EU

We studied which European Union (EU) economy was more attractive prior to Brexit for employees in supervisory positions. We estimate the extra wage that supervisors earn relative to their subordinates—the wage premium to supervision (WPS)—at different quantiles of distribution of wages for 26 European economies. We find that the UK rewards supervisors more than other EU economies. Moreover, the WPS increases with wage and so increases wage inequality. Over 10% of the WPS depends on the national economic context. We discuss the implications for immigration and policymakers in relation to the post-Brexit process.     

The Union Wage Effect in Japan

Previous studies point to Japanese labor unions’ lack of bargaining power that results from their organization at an enterprise level. However, a detailed examination of the institutional setting backed by the Labor Standard Law and Trade Union Law reveals that unions have strong bargaining power against deteriorating work conditions. This paper examines the effect of unions on wages using the Japanese General Social Surveys 2000–2003, which cover a period of economic stagnation. We find a robust union wage premium for both males and females. A Cotton–Neumark decomposition reveals that about one‐fifth of union workers’ higher wage is explained by the difference in the union and nonunion wage structures. We also can confirm the union wage compression effect using the DiNardo, Fortin, and Lemieux (1996 ) method. Union workers are likely to think that they will not find jobs with similar compensation packages if they leave their current jobs. In summary, unions in Japan contribute to an increase in the average wage and compress the wage distribution among their workers. This result is reconciled with previous findings by considering the uniqueness of the macroeconomic conditions of the sample period.     

Whither Solidarity? Transitions in Swedish Public-Sector Pay Policy

As part of a drive for efficiency and decentralization in government operations, Sweden is implementing a new system of pay administration in the public sector that is marked by a clear movement away from centralized wage negotiation and fixed salary increases towards more flexible and individualized pay rates. Despite rhetoric about performance and efficiency, the changes appear to be focused mainly on expanding wage differentials among occupational groups and offering market premiums to recruit and retain valued employees. Although the new pay system has not been integrated into a general management approach, it offers considerable challenge to the norms and values of solidarity that have traditionally been held so strongly in Sweden.     

Effects of Skill and Attitudes on Employee Performance and Earnings

This study uses original survey and archival data from factory and office employees in one firm to relate differences among individual employees' performance to differences in their skill and attitudes about work, and to test the association between employees' earnings and their performance, skill, and attitudes. We suggest that the way in which skill and attitudes affect performance will depend on the type of work that is done. The main results show that among factory employees, those who have on-the-job training and longer experience receive better performance ratings than those without training and with less experience. Factory employees' earnings depend on their performance, following the human capital model of wage determination. Among office workers, training and experience do not significantly affect performance ratings; instead, higher-rated employees have more positive attitudes about work. Office employees' earnings depend on their classroom training, experience, and attitudes, but not on their rated performance.