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November 2011, Week 3

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Mon, 21 Nov 2011 01:21:39 -0500
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Politics Matter
Changes in Unionization Rates in Rich Countries, 1960-2010
John Schmitt and Alexandra Mitukiewicz
Center for Economic and Policy Research
November 2011
http://www.cepr.net/documents/publications/unions-oecd-2011-11.pdf

[moderator: the full document is found at the link above]

Executive Summary

Researchers have offered several explanations for the
decline in unionization. Many emphasize that "globalization"
and the technological advances embodied
in the "new economy"have made unions obsolete.

If the decline in unionization is the inevitable
response to the twin forces of globalization and
technology, then we would expect unionization rates to
follow a similar path in countries subjected to roughly
similar levels of globalization and technology.

Instead, for 21 rich economies, including the United
States, what we see over the last five decades is a wide
range of trends in union membership and collective
bargaining. Union coverage (the share of workers whose
terms of employment were covered by a collective
bargaining agreement) changed little and even rose
slightly in a substantial number of countries, including
the years since 1980.

Union membership (the share of workers who are members
of a union) fell in most of the rich economies, but
losses varied substantially from country to country. The
United States experienced membership losses near the
middle of the distribution, but started from a 1980
membership rate that was low by the standard of other
rich countries.

These differences across countries exposed to broadly
similar levels of globalization and technological change
suggest that these factors do not mechanically determine
national levels of unionization.

The broad national political environment, however, does
appear to explain much of the observed variation in
unionization trends.

Countries strongly identified during the postwar period
with social democratic parties "Sweden, Denmark,
Norway, and Finland " have generally seen small
increases in union coverage and only small decreases in
union membership since 1980.

Over the same period, countries typically described as 
"liberal market economies" the United States, the
United Kingdom, Australia, New Zealand, Ireland, Canada,
and Japan " have generally seen sharp drops in union
coverage and membership.

Countries in the broad Christian democratic tradition,
sometimes referred to as "coordinated market
economies"or "continental market economies"
Germany, Austria, Italy, the Netherlands, Belgium,
France, and Switzerland" typically have had outcomes
somewhere in between the social democratic and liberal
market economies, with small drops in union coverage and
moderate declines in union membership.

These patterns are consistent with the view that
national politics are a more important determinant of
recent trends in unionization than globalization or
technological change.

Introduction

The unionized share of the US workforce has been
declining from the early 1960s through the present. The
pace of that decline was slow at first, but accelerated
at the end of the 1970s, leaving only about 12 percent
of all workers and 7 percent of private sector workers
in unions by 2010 (see Figure 1).

Researchers have offered many explanations for the
decline in unionization. Some suggest that the demand
for union representation has fallen. Most, however,
argue that, for various reasons, the supply of union
jobs has decreased. Some researchers blame the
leadership of the union movement for focusing too much
on a "business" model that emphasizes servicing
existing members rather than organizing new members.
Others emphasize weak legal protections for the right to
organize, in combination with heightened employer
opposition beginning in the early 1980s. But, probably
the most common argument, at least in the public
discussion, is the idea that unions are incompatible
with the emerging, increasingly globalized, high-tech,
service economy.

If the decline in unionization is the inevitable
response to the twin forces of globalization and
technology, then we would expect unionization rates to
follow a similar path in other countries subjected to
roughly similar levels of globalization and technology.

In this report, we review unionization data for the last
five decades for 21 rich economies. We find that trends
in unionization have varied substantially across these
economies. Union coverage (the share of workers whose
terms of employment were covered by a collective
bargaining agreement) changed little and even rose
slightly in a substantial number of countries, including
the period since 1980. Union membership (the share of
workers who are members of a union) fell in most of the
rich economies, with the United States experiencing
losses (from a low initial level of unionization) near
the middle of the distribution. These differences across
countries exposed to broadly similar levels of
globalization and technological change suggest that
neither factor mechanically determines national levels
of unionization.

One simple factor, however, does appear to explain much
of the observed variation in unionization trends: the
broad national political environment. Countries that
have been strongly identified during the postwar period
with social democratic parties " Sweden, Denmark,
Norway, and Finland " have generally seen small
increases in union coverage and only small decreases in
union membership since 1980. Over the same period,
countries that are more typically identified as 
"liberal market economies" the United States, the
United Kingdom, Australia, New Zealand, Ireland, Canada,
and Japan" have generally seen sharp drops in union
coverage and membership. Countries in the broad
Christian democratic tradition, sometimes referred to as
"coordinated market economies" or "continental market
economies" Germany, Austria, Italy, the Netherlands,
Belgium, France, and Switzerland" typically have had
outcomes somewhere in between, with small drops in union
coverage and moderate declines in union membership.
These patterns are consistent with the view that
national politics are a more important determinant of
recent trends in unionization than globalization or
technological change.

___________________________________________

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