Posted: May 26th, 2020
By: Hannah Weiss
Unionization is declining.
A recent report from the Brookings Institute demonstrates that membership in US labor unions has declined since the middle of the twentieth century. Union membership was at its highest in the 1940s and 1950s when almost thirty-five percent of workers belonged to unions. Unionization has declined most in the private sector, with only a little over six percent of private-sector workers belonging to unions in 2018. In contrast, membership in public-sector unions has consistently been about one-third of employees since the 1970s.
Several factors have contributed to this decline in the prevalence of union. For one, the composition of the US economy has shifted. More people now work in service industries, which traditionally have lower rates of unionization, than in the past, when the bulk of US workers held manufacturing jobs. But union membership also fell within industries, which is apparently explained by declining rates of unionization within states.
States with “right to work laws” have particularly seen decreases in unionization. These laws make it illegal to require non-union members to pay any type of dues to unions (because some unions have required non-members to pay nominal fees to account for benefits they receive, despite lack of membership, from collective bargaining).
Another contributing factor to low unionization has been employer reactions to unions and their efforts to prevent or reduce their presence. Employers have become more aggressive in their efforts to keep unions out of their workplaces. These efforts have included “delays between petition and election, hiring of management consultants to resist unionization, and anti-union speech by management,” and even illegal actions like threatening to fire employees for union activities.
Why does declining union membership matter?
Unions can help negotiate improvements in safety and other changes in a workplace that individual employees cannot affect. But they are most important for their ability to ensure higher pay, particularly for lower skill workers. Many studies have been done on the gap between pay of union and non-union workers and, while they have differed in their determinations of the exact difference, they have consistently found higher wages for union employees. But unions also contribute to reducing wage inequality. Among unionized employees, unions raise wages for lower earners and suppress some wages of higher earners, with the effect that there is overall less disparity in wages.
Even more notably, unions also reduce broader income inequality. If unionization had remained constant between the early 1970s and 2001, income inequality may have risen by up to one third less than it actually did. Where unions exist, they can help increase wages among non-union employees because employers pay higher wages to prevent workers from unionizing. They can also help create norms regarding fair pay and equality that spillover into non-union workplaces.
How can the law encourage union membership?
Employer resistance to unionization of their workers is a key factor in the decline of unions. But one of the reasons this resistance has been so effective is that the remedies available under the “National Labor Relations Act (NLRA) . . . fail to offset the damages done and do not effectively deter employers from engaging in illegal behavior.” So, one important first step to strengthening union presences is to better enforce the NLRA and place stronger penalties on employers who violate it.
Another possibility is allowing sectoral bargaining, in which employees and employers negotiate at the industry level. This model, popular in many other countries, increases the number of employees who benefit from collective bargaining (although it does not necessarily increase the number who belong to unions). Sectoral bargaining generally decreases employer resistance to collective bargaining because no individual employer has as much incentive to resist.
The structure of US labor law makes sectoral bargaining fairly unlikely, however, but some individual elements of sectoral bargaining may be possible. For instance, we already have laws that set minimum wages on government-funded contracts (“prevailing wage standards”). We could enact a version of these for the private sector, requiring non-union employers to meet union wage requirements.
We could also change or repeal laws to expand access to unions to employees who are not currently allowed to unionize, such as some independent contractors and farm workers. Being able to go on strike is central to unions’ bargaining power, so another option is to create legal barriers to firing striking employees and hiring permanent replacements. Unions could also increase their offerings of health insurance and other benefits. In the United States, these are generally provided by employers, and the role of unions is only to negotiate better benefits packages. If unions were allowed, and encouraged, to play a greater role in providing them, it would decrease employer costs and increase the bargaining power of unions.
Hannah Weiss is a second-year law student at Wake Forest University. She completed her Bachelor’s degree at the University of Florida and a Master’s degree at the University of Virginia and spent several years in public service before law school. After graduation, she intends to practice international trade law.