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NEW STUDY SHOWS DECLINE IN UNION MEMBERSHIP COSTS NON-UNION WORKERS $3,000 YEAR IN LOST EARNINGS

September 7th 2016

Strong labor unions help everyone who works earn more, according to a study released last week by the Economic Policy Institute (EPI), a Washington D.C.-based nonprofit that advocates for people of low and middle income.

The study shows that if unions were stronger, wages of union members and nonmembers alike would be significantly higher.

When adjustments are made for inflation, economists across the political spectrum agree, millions of Americans today earn less than their predecessors did 40 years ago.

A big reason is declining private-sector union membership, which has dropped from a third of all private-sector employees to just 6.7 percent today.

For its new study, EPI set out to measure how much a non-union worker in America today would benefit if union membership had remained at 1979 levels.

The researchers found that the typical full-time private-sector worker, whether a member of a labor union or not, would be making thousands of dollars more a year today if unions had the power they once did to influence a state’s or region’s standard wages and benefits packages.

“There’s a stereotype that unions only help union workers, but we found that the decline of union membership has had a vast effect on non-union workers,” says economist Jake Rosenfeld, who co-authored the study.

To arrive at their results, the researchers separated the impact of unionization from the effects of the other large contributors to wage erosion in this country: globalization and technological innovation.

If union membership had remained at 1979 levels, they found, in 2013, non-union working men in the private sector would have earned an average of $2,704 more annually.

The average non-unionized male worker without a college degree would have earned an additional $3,016, and those with a high school diploma or less would have earned $3,172 more. (The differences for women were less pronounced because of workforce changes and because women still occupy the majority of non-union, low-paying jobs in the United States.)

EPI’s study also confirms that unions play a key role in reducing economic inequality. The pay gap between CEOs and average workers has exploded in recent decades, from about 20:1 in 1965 to somewhere between 204:1 and 331:1 today.