Unionization Substantially Increases the Wages of Low-Wage Workers

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May 15, 2008

Unionization Substantially Increases the Wages of Low-Wage Workers

"While all workers benefit from union membership, low-wage workers see largest gains"

For Immediate Release: May 15, 2008
Contact: Alan Barber, (202) 293-5380 x115

WASHINGTON, DC: After decades of disappointing wage growth for many American workers, a new report from the Center for Economic and Policy Research (CEPR) shows that unionization significantly boosts the wages of low-wage workers.

The report, "The Union Advantage for Low-Wage Workers," finds that unionization raises the wages of the typical low-wage worker by 20.6 percent. Unions also have a substantial impact on the wages of workers at the middle and top of the wage distribution, but the report found that the effect for low-wage workers was the largest.

For the typical U.S. worker --the earner right in the middle of the national pay scale-- unionization raises wages about 13.7 percent, about two-thirds of the impact of unionization on the typical low-wage worker. For the typical high-wage worker, joining a union increased pay about 6.1 percent, or less than one-third of the increase for low-wage workers.

"Unionization raises wages for all workers, but unions have by far the biggest impact on the wages of the lowest-paid workers," said John Schmitt, a Senior Economist at CEPR and the author of the study.

The disproportionate impact of unions on low-wage workers also holds across the 50 states and the District of Columbia. In each state, the union premium was substantially larger for low-wage workers than it was for middle- or high-wage workers.

"Unions give the biggest boost to low-wage workers because these are the workers that have the least bargaining power in the labor market," Schmitt said. "Unionization has a large and measurable impact on the bargaining power, and therefore the wages, of low-wage workers."

Over the period covered in the report, 13.8 percent of American workers were either members of a union or covered by a union contract at their workplace. Over the same period, the unionization rate varied widely across the United States, from 3.9 percent in North Carolina to 26.4 percent in New York.

The report analyzed five years of data on 16-to-64 year old workers from the Census Bureau's Current Population Survey (CPS) for the years 2003 through 2007, the most recent years available.

Additional state-specific information is available from the following organizations:

Alaska

Lawrence D. Weiss Ph.D., M.S.
Executive Director
Alaska Center for Public Policy
Anchorage AK  99521-0490
Office Phone:   907.276.2277
Cell Phone:      907.240.4141
Toll Free Fax:   1.866.366.9352
ldweiss@acpp.info
www.acpp.info

Colorado

Rich Jones
The Bell Policy Center
1801 Broadway #280
Denver  CO  80202
303/297-0456
jones@thebell.org


Florida

Bruce Nissen
Director
Research Institute for Social and Economic Policy Center for Labor Research and Studies
Florida International University Miami, FL 33199
305-348-2616
Fax: 305-348-2241
E-mail: Bruce.Nissen@fiu.edu


Maryland

Matthew Weinstein
Progressive Maryland
matthew@progressivemaryland.org
443.418.4181


Maine


Christopher St. John
Executive Director
Maine Center for Economic Policy
124 Sewall St.
PO Box 437
Augusta ME 04332
207 622-7381, fax 622-0239, cell 441-2694
www.mecep.org


North Carolina

John Quinterno
Research Associate
NC Budget & Tax Center
(919) 856-3185
john@ncjustice.org


New Jersey

Jon Shure
President
New Jersey Policy Perspective
137 W. Hanover St.
Trenton, NJ 08618
(609)393-1145
shure@njpp.org
http://www.njpp.org/


New York

David Dyssegaard Kallick
Senior Fellow
Fiscal Policy Institute
11 Park Place
New York, NY 10007
212/721-7164
212/721-5415
ddkallick@fiscalpolicy.org
www.fiscalpolicy.org


Ohio

Amy Hanauer
Policy Matters Ohio
3631 Perkins Avenue, Suite 4C-East
Cleveland, OH 44114
216/361-9801 (phone)
216/361-9810 (fax)
216/921-0354 (home)
www.policymattersohio.org


Oregon

Charles Sheketoff
Executive Director
Oregon Center for Public Policy
204 N. First, Suite C
PO Box 7
Silverton, OR 97381
tel. 503.873.1201, ext. 331
csheketoff@ocpp.org
http://www.ocpp.org


Pennsylvania

Mark A. Price, Ph.D.
Labor Economist
Keystone Research Center
412 North 3rd Street
Harrisburg PA 17101
717-255-7181
price@keystoneresearch.org
www.keystoneresearch.org


Washington

Marilyn P. Watkins, Ph.D.
Policy Director
Economic Opportunity Institute
1900 N. Northlake Way, Suite 237
Seattle, WA 98103
(206) 529-6370
marilyn@eoionline.org


West Virgina

Ted Boettner, Executive Director
West Virginia Center on Budget & Policy
tboettner@wvpolicy.org
tel: 304/720.8682


Wisconsin

Joel Rogers
Director
Center on Wisconsin Strategy
608-262-4266
jrogers@cows.org

or

Laura Dresser
Associate Director
Center on Wisconsin Strategy
University of Wisconsin Madison
1180 Observatory Drive
Madison WI 53706-1393
ldresser@cows.org
www.cows.org
608-262-6944


Wyoming

Dan Neal
Executive Director
Equality State Policy Center
340 West B Street Suite 203
Casper, WY 82601
307-472-5939
dneal@equalitystate.org

or

Sarah Gorin
Equality State Policy Center
307-745-8594

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The Center for Economic and Policy Research is an independent, nonpartisan think tank that was established to promote democratic debate on the most important economic and social issues that affect people's lives. CEPR's Advisory Board of Economists includes Nobel Laureate economists Robert Solow and Joseph Stiglitz; Richard Freeman, Professor of Economics at Harvard University; and Eileen Appelbaum, Professor and Director of the Center for Women and Work at Rutgers University.