13.4 Market Power on the Supply Side of Labor Markets: Unions
13.4 Market Power on the Supply Side of Labor Markets: Unions
Learning Objectives
By the end of this section, you will be able to:
- Explain the concept of labor unions, including membership levels and wages
- Evaluate arguments for and against labor unions
- Analyze reasons for the decline in U.S. union membership
A labor union is an organization of workers that negotiates with employers over wages and working conditions. A labor union seeks to change the balance of power between employers and workers by requiring employers to deal with workers collectively, rather than as individuals. As such, a labor union operates like a monopoly in a labor market. We sometimes call negotiations between unions and firms collective bargaining.
The subject of labor unions can be controversial. Supporters of labor unions view them as the workers’ primary line of defense against efforts by profit-seeking firms to hold down wages and benefits. Critics of labor unions view them as having a tendency to grab as much as they can in the short term, even if it means injuring workers in the long run by driving firms into bankruptcy or by blocking the new technologies and production methods that lead to economic growth. We will start with some facts about union membership in the United States.
Facts about Union Membership and Pay
According to the U.S. Bureau of Labor and Statistics, about 10.5% of all U.S. workers belong to unions. Following are some facts about unions for 2018:
- 11.1% of U.S. male workers belong to unions; 9.9% of female workers do
- 10.4% of white workers, 12.5% of black workers, and 9.1% of Hispanic workers belong to unions
- 11.6% of full-time workers and 5.4% of part-time workers are union members
- 5.11% of workers ages 16–24 belong to unions, as do 12.8% of workers ages 45-54
- Occupations in which relatively high percentages of workers belong to unions are the local government 40.3%; protective services 33.9%; and education, training, library occupations 33.8%.
- Occupations that have relatively low percentages of unionized workers are farming, fishing, forestry 2.4%; sales and related occupations 3.3%; and food preparation and serving 3.9%
In summary, the percentage of workers belonging to a union is higher for men than women; higher for blacks than for whites or Hispanics; higher for the 45–64 age range; and higher among workers in government and manufacturing than workers in agriculture or service-oriented jobs. Table 13.12 lists the largest U.S. labor unions and their membership.
|
Union |
Membership |
|
National Education Association (NEA) |
2.9 million |
|
Service Employees International Union (SEIU) |
1.9 million |
|
American Federation of Teachers (AFT) |
1.5 million |
|
International Brotherhood of Teamsters (IBT) |
1.3 million |
|
The American Federation of State, County, and Municipal Workers (AFSCME) |
1.3 million |
|
United Food and Commercial Workers International Union |
1.3 million |
|
International Brotherhood of Electrical Worke