Accounting for the Decline of Unions in the Private Sector, 1973-1998(*)

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Authors: HENRY S. FARBER and BRUCE WESTERN
Date: Summer 2001
From: Journal of Labor Research(Vol. 22, Issue 3)
Publisher: Transaction Publishers, Inc.
Document Type: Article
Length: 10,518 words

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I. Overview

After documenting the long decline in private sector unionism over the last 50 years, we present an accounting framework that decomposes the sharp decline in the private sector union membership rate into components due to (1) differential growth rates in employment between the union and nonunion sectors and (2) changes in the union new organization rate (through NLRB-supervised representation elections). We find that most of the decline in the union membership rate is due to differential employment growth rates and that changes in union organizing activity had relatively little effect. Given that the differential employment growth rates are due largely to broader market and regulatory forces, we conclude that the prospects are dim for a reversal of the downward spiral of labor unions based on increased organizing activity.

II. The Issue

In 1956, one in three private sector workers were members of labor unions. By 1998, fewer than one in ten were members of unions. In stark contrast, the union membership rate among public sector workers increased from 12 percent to 39 percent over the same period.

While the increase in public sector unionism appears well understood, there is substantial disagreement about reasons for the sharp decline in the private sector union membership rate.(1) Many observers have argued that union decline is rooted in a failure of union organizing activity in the 1970s and 1980s. Some focus on the intensified opposition to unions by employers (Freeman, 1988; Weiler, 1983). Another view is that changes in the administration of the National Labor Relations Act (NLRA) due to changes in composition of the National Labor Relations Board (NLRB) (Levy, 1985). Others claim that changes in the U.S. economic environment substantially reduced the attractiveness of unions to workers and the acceptability of unions to employers. In this view, the economic environment became increasingly open to foreign competition in product markets and capital became more mobile internationally (Macpherson and Stewart, 1990; Troy, 1986). Consequently, unions could no longer guarantee their workers higher wages while maintaining reasonable levels of job security.

Herein we present an accounting framework that decomposes the sharp decline in the private sector union membership rate into components due to (1) differential growth rates in employment between the union and nonunion sectors and (2) changes in the union new organization rate (through NLRB-supervised representation elections). We use this framework to contrast two explanations for the decline of union membership in the private sector. The first explanation emphasizes the level of union organizing activity. The second is based on differential employment growth rates in the union and nonunion sectors. Our goal is to evaluate the prospects for an increase in organizing activity sufficient to reverse the downward spiral of labor unions.

Although our analysis focuses on the twenty-five years from 1973 using data from the Current Population Survey (CPS), we begin by presenting the facts on the union membership rate over the last century, from 1880 through 1998. After placing the last quarter of the 20th century in the context of...

Source Citation

Source Citation
FARBER, HENRY S., and BRUCE WESTERN. "Accounting for the Decline of Unions in the Private Sector, 1973-1998(*)." Journal of Labor Research, vol. 22, no. 3, summer 2001, p. 459. Accessed 16 Sept. 2021.
  

Gale Document Number: GALE|A76577766