Union Dynamics at the Establishment Level

The share of workers covered by union contracts has plummeted dramatically in recent years. This research project studies this union decline in three new ways. First, it takes a new viewing angle to observe the process. Previous work looks at the process at the industry level or at the regional level. In contrast, this project studies union dynamics at the establishment level. Second, the project collects and creates new data sets. In particular it will recover discarded data on union local organizations (the Labor Organization and Reporting System) spanning 1960 to the present and it will publicly archive this new data. Third, the project focuses on a new issue, the role of neighborhood or spillover effects. A neighborhood effect exists when it is easier for a union to organize an establishment when neighboring establishments are organized. The issue of neighborhood effects is important, because when these effects are present, small changes in the underlying economic environment can lead to large changes in the extent of unionism. The project will quantify the extent to which neighborhood effects can account for why unions collapsed in the early 1980s, and why unions are weak in the South, but are still strong the upper Midwest and Northeast.

Understanding the process of union decline is of direct interest in itself. But in addition, this process has been intertwined with numerous other major trends in the economy. These trends include: the rise in the wage differentiable between skilled and unskilled workers, the movement towards the use of temporary workers and the rise of outsourcing, and the major shift in manufacturing from the union North to the nonunion South. The research in this project increases our understanding of all of these issues. The research also contributes to the general economics literature by making progress in identifying neighborhood effects. Neighborhood effects are thought to arise in many economic contexts including technology adoption, education, and even crime. The procedures developed in this research project have the potential to be applied to these other issues.