Union membership down, income inequality up

Union membership down, income inequality up

By August 30, 2012: 9:22 AM ET

The decline of union membership has been a key driver of income inequality in recent decades, a new report found.

The drop in unionization accounts for roughly a third of the growth in wage inequality among men and a fifth among women between 1973 and 2007, according to the left-leaning Economic Policy Institute.

The share of the workforce represented by unions declined from 26.7% in 1973 to 13.1% in 2011. This contributed to the increase in inequality by lowering wages for middle class workers, according to EPI.

A non-partisan Congressional Budget Office report last year showed that the average household income for the nation’s top 1% more than tripled, while middle-class incomes grew by less than 40% between 1979 to 2007.

The pullback in unionization has also been a primary cause of the growing wage gap between white- and blue-collar men, as well as between college-educated and high school-educated men.

“Unions reduce wage inequalities because they raise wages more at the bottom and in the middle of the wage scale than at the top,” said Lawrence Mishel, EPI’s president.

Declining unionization has hurt men more than women because men were more likely to have been in unions in their heyday.

Union workers are paid a premium of 13.6% thanks to their collective bargaining contracts, according to EPI.

Blacks and Hispanics enjoy premiums of 17.3% and 23.1%, respectively, while whites have a 10.9% bump. Men see a 17.3% premium and women 9.1%.

This advantage is calculated by comparing hourly wages between union and non-union workers who are otherwise comparable in terms of experience, education, industry and other factors.

A Labor Day Message

 A Labor Day Message

News content published by The Mountaintop Eagle.
Internet Edition managed using© 2012. All Rights Reserved.

Published as part of the August 29, 2012 edition. Last updated August 29, 2012.

By RICK BLOOMINGDALE
President, Pennsylvania AFL-CIO

Labor Day is the one holiday on the calendar devoted to honoring and recognizing America’s workers and their families and the value we bring to the prosperity and strength of our nation. That’s pretty much all of us, whether we’re employed or looking for work. And no matter what we do, our work makes the work of others possible. Teachers depend on electricians, who count on steelworkers, who need nurses and engineers, who rely on researchers and bus drivers and flight attendants, who depend upon taxi drivers and child care workers, who need auto workers and traffic cops and firefighters, and so on it goes.

Work connects us all. And together, we are better. Here’s what else connects us: Our vision of an America that values and respects work and the people who do it. Not some of us, all of us. Today we are further from this vision than we have been in many generations. Continue reading “A Labor Day Message”