Following up on a post earlier today, unions play an important role in giving workers political representation:
Was the decline of American unions inevitable? Ask Canada., by Brad Plumer: Since the 1960s, organized labor in the United States has been steadily withering. A half-century ago, 30 percent of all American workers were members of a union. By last year, that number had shriveled to 11.8 percent. Economists have proposed all sorts of explanations for the drop, from the shrinking of the U.S. manufacturing workforce to foreign competition that has made U.S. companies more hostile toward unions.
But a new paper (pdf) from Kris Warner of the Center on Economic and Policy Research suggests that the decline in U.S. labor unions wasn’t simply due to inexorable economic forces. Government policies likely played a big role too. And the easiest way to see this, Warner argues, is by comparing unionization rates in the United States to rates in nearby Canada, “the country that is probably more like the U.S. than any other – economically, socially, and politically.”
Here’s the key graph from the paper:
Between the 1920s and 1960s, both countries saw a similar surge in union membership, thanks to changes in labor law and the growth of sectors ripe for organizing, such as automobile manufacturing. But around 1965, something changed. The two countries diverged. Union membership held steady in Canada, but plummeted in the United States.
So why the split? ... Warner suggests ... the biggest reason for the two nation’s contrasting fates has to do with labor law. Canada’s rules for organizing labor unions are largely overseen by its provinces, and, until recently, Canada’s rules simply made it much easier for workers in the private sector to form a union. ...
There’s a second key policy difference, too, Warner notes. In Canada, workers who have formed a union can seek arbitration to ensure that they actually get a contract. By contrast, in the United States, employers have much more freedom to delay that process. ...