We’ve been studying union effects in my Industrial Relations class this week. Professor Michael Lynk from Western Law School presented the inaugural Workplace Law Lecture here at the School of HRM and argued that there is a direct link between falling unionization rates and rising income inequality. Now the fine librarians at the U. of Toronto Centre for Industrial Relations pass along word of a new international study of the link between unionization and “life satisfaction”. The paper is called “Labor Unions and Life Satisfaction” Evidence from New Data” by Professors Flaven & Radcliff (U. Notre Dame) and Professor Pacek (Texas A&M). It looked at the link between unionization and life satisfaction measures for 14 countries (including Canada).
The authors summarize their findings as follows:
To sum as bluntly as possible, it is the most vulnerable members of society who are most positively affected by membership in and the influence of organized labor in the industrial world. In addition, we confirm Radcliff’s (2005) principal finding of interest that labor unions not only affect their own members, but society in general. While lower status citizens are clearly the main beneficiaries of organized labor’s efforts, those benefits are diffused through society at large. Perhaps most crucially, we demonstrate that even in an era of declining union status across the industrial world that organized labor still affects life satisfaction to a significant extent… Whatever other consequences may be attributed to labor unions regarding economic or social areas, they do appear to contribute to the degree to which people find their lives satisfying.
This finding seems consistent with those measures that come out occasionally showing the “happiest countries” in the world. That list is always topped by countries that also have the highest levels of people who are covered by a collective agreement bargained by a union. For example, here is the ranking of happiest countries’ top four (with their approximate collective agreement coverage rates in brackets): 1. Denmark (70%); 2. Finland (74%); 3. Netherlands (22%); 4. Sweden (80%). On the other hand, the USA, with a unionization rate around 12% does not even crack the top 10. (By the way, Canada came 6th, and we have a unionization rate just under 30%).
The authors conclude with a provocative question similar to the one Professor Lynk made about the implications for society if income inequality continues to grow:
Assuming organized labor continues to decline at current rates, especially in countries like the United States, what then might we speculate about a concomitant impact on human well-being as a result?
Professor Lynk pointed out the social problems associated with income inequality (crime, poor health, alienation, et cetera) in arguing for the need to bolster union representation–a point that President Obama has been making in his efforts to win labor law reform in the U.S. This study now shows that unions contribute to happier societies and happier citizens.
Why do you think, in light of these sorts of studies, that there is so much political opposition to labour laws that would make it easier for workers to unionize?
