In her August article, “Fewer Unions, Lower Pay for Everybody” in The Atlantic, Alana Semuels points out that wealth inequality in the U.S. today is similar to that in 1920’s America: “the bottom 90 percent accounted for just 49.6 percent of all pretax income, while the top 1 percent held 22.5 percent.” She presents several theories about why American wealth has again become distributed this way in 2016. One theory is that “union decline has led to greater income inequality ... [because] the presence of unions significantly affects the wages of non-union workers, especially those without a college degree. Non-union men without a high school diploma would be experiencing weekly wages that were 9 percent higher if union density had remained at 1979 levels.” Her data come from a think tank paper (@JakeRosenfeld1, @PatrickADenice, Jennifer Laird) that looks at how reduced union membership and strength affect the earnings of workers who don’t belong to unions.
Americans today have mixed feelings toward unions. Gallup Poll data show that over the past decade, American approval of unions has ranged between 50% and 60%. Most people probably realize that, as explained by Matthew Walters of the Economic Policy Institute, “evidence clearly shows that the labor protections enjoyed by the entire U.S. workforce can be attributed in large part to unions. The workplace laws and regulations, which unions helped to pass, constitute the majority of the labor and industrial relations policies of the United States.”
It seems less clear, however, if most Americans today would agree with Walters that “these laws in and of themselves are insufficient to change employer behavior and/or to regulate labor practices and policies. Research has shown convincingly that unions have played a significant role in enforcing these laws and ensuring that workers are protected and have access to benefits to which they are legally entitled.” Although I personally am convinced that unions are necessary in the U.S. to ensure fair pay and safe work conditions, I realize that union membership and popularity have decreased in the past 30 years.
Nor does Semuels (@alanasemuels)see big union growth on the horizon, writing that “despite data showing that unionization can help raise wages and decrease income inequality, there are few signs that any return to widespread unionization is probable. Though the anti-union legislation that cropped up (@Monicadavey1) after 2010 seems to have subsided, there are only a few sectors in which unions are growing—namely healthcare and the service industry.”
I write about and advocate for blue collar workers in articles and in Financial Advice for Blue Collar America, and I see growing interest in blue collar careers among young people. Lots of jobs that require a 4-year college degree yield low life-time salaries whereas many blue collar jobs result in high salaries (@KathrynDill) – with no college debt to dog you for 20 years. As pride in and commitment to blue collar careers grows, it may be that union strength returns, bringing with it the possibility of fairer wages for everyone.
Kathryn Hauer is an adjunct professor at Aiken Technical College, Certified Financial Planner™, and financial literacy educator. She wrote Financial Advice for Blue Collar America, which discusses basic concepts of money including insurance and taxes, financial traps to avoid, how to pay for college and tech school, and the bright future ahead for blue collar careers.