Economic Impacts of New Unionization on Private Sector Employers: 1984-2001

Abstract

Economic impacts of unionization on employers are difficult to estimate in the absence of large, representative data on establishments with union status information. Estimates are also confounded by selection bias, because unions could organize at highly profitable enterprises that are more likely to grow and pay higher wages. Using multiple establishment-level data sets that represent establishments that faced organizing drives in the United States during 1984 -1999, this paper uses a regression discontinuity design to estimate the impact of unionization on business survival, employment, output, productivity, and wages. Essentially, outcomes for employers where unions barely won the election (e.g., by one vote) are compared with those where the unions barely lost. The analysis finds small impacts on all outcomes that we examine; estimates for wages are close to zero. The evidence suggests that-at least in recent decades-the legal mandate that requires the employer to bargain with a certified union has had little economic impact on employers, because unions have been somewhat unsuccessful at securing significant wage gains.

Is the Union Employment Suppression Effect Diminishing? Further Evidence from Canada

“…This result suggests that during 1984 to 2001, newly-organized firms in the United States did not pay any wage premium nor suffer any deleterious effects on employment. DiNardo and Lee (2004) explain the discrepancy with other studies showing the persistence of some level of union wage premium by hypothesizing that any union wage premium that in fact remains is a product of union gains made in the period prior to the 1980s, and that these gains will slowly diminish as 'newly-organized' firms that pay no union wage premium are averaged into the mix and as the wages in 'long-established' union firms diminish relative to non-union firms.…”

“…Using a somewhat different specification than the previous studies, Blackburn (2008) One interesting study, also conducted in the United States, used data covering the period from 1984 to 2001 (DiNardo andLee, 2004). These researchers examined data from newly-organized firms in order to determine the impact of unionization.…”

Corporate Governance Objectives of Labor Union Shareholders: Evidence from Proxy Voting

“…The findings are similar if these four firms are excluded from the sample. For the remaining companies in the subsample, I then consult NLRB elections and petitions from 2001-2007 (limiting the search to elections with twenty workers or more, following Dinardo and Lee 2004). For two firms, this data yields union information and hence union categorization.…”

The Effect of Teachers’ Unions on Education Production: Evidence from Union Election Certifications in Three Midwestern States

“…Freeman and Kleiner (1990) find very modest wage increases among newly unionized firms in the 1980s that they sampled, relative to similar nonunion firms. Dinardo and Lee (2004) estimate the effect of unionization on business survival, employment, output, productivity, and wages using a regression discontinuity framework. Local to the 50% election vote discontinuity, they find that private sector unions have little effect on these outcome measures.…”