Individual Workplace Studies

Recognizing the limitation of these government data, researchers have come up with new ideas on how to measure the impact of unionization on average worker wages. One method that has been used recently is to compare workers’ wages at firms that narrowly voted to unionize with workers’ wages at firms that narrowly voted not to unionize. Tracking these same firms and the same workers over time mitigates the aforementioned firm-size bias.

One recent study that employs this technique was conducted by Brigham Frandsen and published in 2013. Frandsen used a regression discontinuity research design and matched individual worker earnings to employers based on close union elections. He used a large dataset of firms from across the entire economy covering a span of 30 years. Union certification election results from 45,176 elections were matched with a dataset of 23 million different businesses from the Census Bureau’s Longitudinal Business Database. Frandsen was able to match 82 percent of these union elections, allowing him to track the performance of individual businesses that had recently voted to unionize or recently voted not to unionize.[10]

To analyze the impact of unionization on individual employees employed by these firms, Frandsen relied on a dataset of individual-level earnings from the U.S. Census Bureau’s Longitudinal Employer-Household Dynamics database. These data range from 1985 to 2008 and contain 2.8 billion records. Frandsen matched these records with those that had been matched from the union election database and the business database.[11]

By comparing the wages and employment security of workers who had just voted to unionize and those who had just narrowly voted not to unionize, Frandsen was able to isolate, as best as possible, the impact that unionization had on real, individual workers. As the title of his paper states, the findings were “surprising.”[12]

Frandsen found that recently unionized firms actually reduce payroll, pay lower wages on average, hire fewer workers and were more likely to go out of business than firms that almost but did not unionize. The reduction in payroll and average lower wages at recently unionized firms was primarily caused by the more experienced and higher paid employees leaving the firms after unionization. But even workers who remain employed by newly unionized firms “are little affected on average,” according to Frandsen’s research.[13]

If the older employees who leave were relatively well paid because of the value that generated for the firm, it stands to reason why the firms that pushed these workers out through unionization also were more likely to go out of business. This creates somewhat of a conundrum for workers seeking out unionization as a means to better wages and working conditions. If they are successful in unionizing, they are more likely to be unemployed than if they were not successful in unionizing.

Frandsen’s research is probably the closest study of the real impacts of unionization on individual workers. All other efforts, many of them outlined above, must rely on aggregated government data, and these data, no matter how reliable, have inherent shortcomings and biases that researchers can only attempt to partially mitigate through statistical controls. Frandsen tracks the conditions of real workers and firms over time and isolates the unionization variable as best as possible. His findings help provide a better overall picture of the effects of unionization and should be of particular interest to employees who are considering organizing a new union in a workplace.