Matching and Inverse Propensity Weighting Estimates of the Union Wage Premium: Evidence from Canada, 1997–2014

I estimate the union wage premium for private‐sector workers using Canadian data from Statistics Canada's Labour Force Survey from 1997 to 2014, examining the trend and gender differences in the premium. I obtain my estimates using matching and inverse propensity weighting estimators, which form counterfactuals for union workers. These estimators create better covariate balance and can also be used to address the bias that arises from the log transformation of wages.     

The Coverage of Collective Pay-setting Institutions in Britain, 1895–1990

Fewer than 50% of British employees now have their pay and conditions affected by collective pay-setting institutions — collective bargaining or wages councils. This paper charts the historical context for the current picture of a decollectivized Britain, constructing a time series on coverage from 1895 to 1990. Extant estimates and sources of coverage data are presented and discussed alongside estimates drawn from a source used only sparingly before now — the number of workers affected by changes in wage rates of national agreements or wage orders. The recent decline in collective bargaining coverage is the most prolonged ever recorded and has been noticeably steeper than the fall in union density, such that the proportion of British workers covered is lower now than in the 1940s. With the abolition of wages councils in 1993, collective pay-setting machinery now affects the pay and conditions of fewer workers than it did in the 1930s.     

Enterprise Unions in the United States

Through a case study of a large industrial company ( TRW ) , this paper examines the history and functioning of independent local unions ( ILUs ). TRW's ILU plant wages were about the same as those at affiliated union plants and higher than those at nonunion plants. The premium explains why TRW and other companies discarded ILUs in favor of a "new" nonunion model. Yet ILUs can remedy some of the defects in that model and thus belong on the policy and research agenda     

Unionism in the United States and Other Advanced OECD Countries

In this paper we compare the changing pattern of unionization in OECD countries, reviewing existing evidence and presenting new information on union-nonunion differentials in labor market outcomes in these countries. Our principal source of information are the micro data files of the International Social Survey Programme cross-country surveys of 1985–87. Our analysis shows that U.S. unions have a larger effect on wages than on other outcomes than unions in other OECD countries, and we argue that the high union premium in the United States has contributed to the decline in union density and divergence of the US. industrial relations system     

Indicative and Updated Estimates of the Collective Bargaining Premium in Germany

This study provides updated evidence on the union contract differential in Germany using establishment‐wide wage data and two estimation strategies. It provides pairwise estimates of the union differential based on separate samples of collective bargaining leavers and joiners vis‐à‐vis the corresponding counterfactual groups. We report that average wages increase by 3 to 3.5 percent after entering into a collective agreement and decrease by 3 to 4 percent after abandoning a collective agreement. Excluding establishments that experience mass layoffs does not significantly influence these net findings, although such establishments record wage losses—statistically insignificant for joiners but up to 10 percent in the case of leavers, as compared with the counterfactuals. The backdrop to these new indicative estimates, which are properly conditioned on establishment size and industry affiliation, inter alia, is one of wage stagnation and continuing union decline.     

The Prevalence and Effects of Occupational Licensing

Our study provides the first national analysis of the labour market implications of workers who are licensed by any agency of the government in the USA. Using a specially designed Gallup survey of a nationally representative sample of Americans, we provide an analysis of the influence of this form of occupational regulation. We find that 29 per cent of the workforce is required to hold a licence, which is a higher percentage than that found in other studies that rely on state‐level occupational licensing data or single states. Workers who have higher levels of education are more likely to work in jobs that require a licence. Union workers and government employees are more likely to have a licence requirement than are non‐union or private sector employees. Our multivariate estimates suggest that licensing has about the same quantitative impact on wages as do unions — that is about 15 per cent — and that being both licensed and in a union can increase wages by more than 24 per cent. However, unlike unions which reduce variance in wages, licensing does not significantly reduce wage dispersion for individuals in licensed jobs.     

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.     

Oligopoly, open shop unions and trade liberalisation

In an international duopoly model, we investigate how trade liberalisation impacts on collective bargaining outcomes when workers are represented by open shop unions. We find that, with intermediate levels of union density, trade liberalisation may lead to higher negotiated wages even if no trade occurs in equilibrium. In addition, we show that union wages may be higher with free trade than in autarky.     

The Impact of Human Resource Policies on Union Organizing

Using newly available data from the Conference Board on employer human resource policies, certification election outcomes, and union organization of new company facilities, we find that the logic of "union substitution" efforts by employers is supported: Companies having or encouraging employee communication and participation programs, including nonunion grievance procedures, are more successful in maintaining nonunion status than are companies without such programs. However, certain human resource policies, such as work sharing (as an alternative to layoffs), may actually enhance chances of union success.     

Executive Compensation in American Unions

We explore compensation of labor union leaders using U.S. panel data on more than 75,000 organization‐years from 2000 to 2007. We find that membership, estimated average wages, and dues are strongly related to the compensation of the leaders of American labor unions, even after controlling for organization size and organization fixed effects. That is, within the same union over time, higher levels of these measures are associated with higher levels of pay for union leaders.     

Unions as Facilitators of Employment Rights: An Analysis of Individuals’ Awareness of Parental Leave in the National Longitudinal Survey of Youth

This study considers the role of unions and individual characteristics as facilitators of knowledge among employees concerning labor rights. Labor policy by itself is often meaningless without mechanisms that allow implementation of such policy. Using the National Longitudinal Survey of Youth (NLSY), individuals that are entitled to parental leave under the Family and Medical Leave Act but are ignorant of their right were identified. Using longitudinal data from 1992 to 2002, we find that union members’ knowledge regarding their rights is better than that of nonunion members. Other individual and work characteristics are also associated with knowledge regarding parental leave rights.     

Decentralized Wage Formation in Sweden

Recent Swedish collective bargaining agreements have incorporated provisions for local pay review talks and opportunities for individuals to negotiate their own wages. Using trade union data, we show that members who participate in local pay review talks and members who negotiate their own wages have significantly higher monthly wages than those who do not. Pay decentralization either improves an individual's bargaining position or attracts more productive trade union members. Either way, trade union wage policies to increase individual‐level wage variance are achieving their intended effects.     

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.     

How did the COVID-19 pandemic affect men's and women's returns to unionization?

Using data from the Current Population Survey for the period 2015 to 2021, I study union-nonunion differences in employment, wages and other terms and conditions before and after the COVID-19 pandemic. Analyses are run separately for men and women. I find that, compared to non-union workers, union workers were better able to retain employment, less likely to do telework, and more likely to receive pay for the hours they did not work during the pandemic. These patterns were more evident for female workers.     

Men at Work in a Land Down‐Under: Testing Some Predictions of Human Capital Theory

We use new training data from waves 3–6 of the Household, Income and Labour Dynamics in Australia Survey to investigate training and wages of full‐time men. We explore the extent to which the data are consistent with the predictions of human capital theory or with recent alternative theories based on imperfectly competitive labour markets. According to the raw data, most work‐related training received by full‐time private‐sector men is general, but it is also paid for by employers. Our fixed effects estimates reveal that this training is associated with higher wages in current and in future firms, and that the effect in future firms is larger and more precisely determined. These results are more consistent with the predictions of human capital theory based on imperfectly competitive labour markets than with the alternative of perfect competition.     

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.     

Declining Union Density in the 1980s: What Do Panel Data Tell Us?

In this paper we analyse data from the 1980—4 WIRS panel for the light they can shed on the causes of the decline in aggregate trade union density in the UK. We argue that, contrary to conventional wisdom, intra-establishment union density did, on average, decline between 1980 and 1984. This suggests that a traditional compositional change story is untenable. We proceed to investigate the correlation of intra-establishment change with variables suggested by the various hypotheses advanced to explain declining density over the period. We find some evidence for an influence of intra-establishment compositional changes, but the most statistically significant variables are wages and unemployment. These take the wrong sign, however, to support the business cycle interpretation of falling aggregate union density.     

Effects of Occupational Licensing and Unions on Labour Market Earnings in Canada

Using longitudinal data from the Canadian Survey of Labour and Income Dynamics from 1999 to 2011, the article compares the pay and benefits of licensed and unionized workers. In a cross section of respondents and using ordinary least squares estimates, it finds a pay premium of 0.155 log points for those with an occupational licence compared to those without one; the comparable union wage premium is slightly more than half, that is 0.085 log points. Fixed‐effects estimates go in the opposite direction (0.028 and 0.046 log points for licensing and unionization, respectively), suggesting the existence of unobservable factors correlated with licensing and union status. Unionized workers are more likely to access standard benefits, such as medical insurance and pension plans, but licensed workers benefit little from their licensing status in access to benefits. Finally, union workers are significantly less likely to receive incentive pay, such as profit sharing, while the association between occupational licensing and incentive pay is close to zero and statistically insignificant.     

Menu Costs, Nominal Wage Revisions, and Intracontract Wage Behavior

We use data from indexed and nonindexed Canadian wage agreements to study the intracontract profile of nominal and real wages. Allowing for endogenous switching between the two indexation categories, we conclude that the number of nominal wage revisions depends on contract duration, expected inflation, and the cost of adjusting wages. Our results have implications for the menu cost, overlapping contracts, dynamic monopoly union, and efficient bargain literatures.