Revisiting Union Wage and Job Loss Effects Using the Displaced Worker Surveys

Abhir Kulkarni () and Barry Hirsch ()
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Abhir Kulkarni: Georgia State University

No 12786, IZA Discussion Papers from Institute of Labor Economics (IZA)

Abstract: Estimates of union wage effects have been challenged due to concerns over unobserved worker heterogeneity and endogenous job changes. Many believe that union wage premiums lead to business failures and other forms of worker displacement. In this paper, displacement rates and union wage gaps are examined using the 1994-2018 biennial Displaced Worker Survey (DWS) supplements to the monthly Current Population Surveys. For more than two decades, displacement rates among union and nonunion workers have been remarkably similar. We observe changes in earnings resulting from transitions between union and nonunion jobs following exogenous job changes. Consistent with prior evidence from the 1994 and 1996 DWS, we obtain longitudinal estimates of average union wage effects close to 15 percent, similar to standard cross-section estimates and suggestive of minimal ability bias. Wage losses moving from union to nonunion jobs exceed gains from nonunion to union transitions.

Keywords: union wage gaps; job loss; displaced workers (search for similar items in EconPapers)
JEL-codes: J31 J51 J65 (search for similar items in EconPapers)
Pages: 37 pages
Date: 2019-11
New Economics Papers: this item is included in nep-lma
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Citations: View citations in EconPapers (1)

Forthcoming - published in: ILR Review, 2021, 74 (4), 948-976

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Journal Article: Revisiting Union Wage and Job Loss Effects Using the Displaced Worker Surveys (2021)
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