Here's what we know: Union membership has been nearly cut in half over the past thirty years. During that time, income inequality grew, with the top one percent of wealthiest Americans seeing especially big gains in their pre- and post-tax income. And although the economy has grown, wages have not: The portion of GDP going toward workers' pay has shrunk by almost six percentage points over the last decade.
The causal chain is so tempting: As unions get smaller, collective bargaining gets weaker, worker wages go down, and evil profiteers cackle. But is it clear that the decreasing power of unions has made it harder for employees to afford everyday life? This idea was discussed at a recent Atlantic working summit on "secure livelihoods," which focused on systemic causes of persistent income inequality; what does the research say?
As is so often true, it's difficult to determine exactly how the decrease in union power has affected the income and quality of life of workers. In a 2011 article in The American Sociological Review, Bruce Western and Jake Rosenfeld argue that the decline of organized labor can account for about one-third of the rise in income inequality for men and one-fifth for women -- even for people who never belonged to unions. In regions of the U.S. where more people belong to unions, they argue, there is a smaller difference between how much money high-paid and low-paid workers make. Over time, as union membership has dropped, the gap between rich and poor has grown for everyone, union and non-union alike. Western and Rosenfeld attribute this to the soft power of organized labor: If union strikes loom as a credible threat, all employers in an area are more likely to provide robust benefits and pay.