Re: Unions and the Path to Irrelevancy

by Ramesh Ponnuru

I cited some studies on the decline of private-sector union membership in a column last year:

In a study of the decline of unions between 1973 and 1988, economist Henry Farber and sociologist Bruce Western found that the chief reason was that nonunionized companies grew faster than unionized ones. Employment at unionized companies dropped by 2.9 percent per year while employment at nonunionized companies rose by 2.8 percent a year. . . .

You might be thinking that unionized companies shrank mainly because they tended to be in declining industries. But you would be wrong. Economist Barry T. Hirsch has found that only 20 percent of the decline in unions between 1983 and 2002 resulted from shrinking unionized industries. Eighty percent of it resulted from a decline within industries. Take manufacturing: Between 1973 and 2006, the number of unionized workers in that sector dropped by 6 million, but the number of nonunion employees rose by 1.5 million. In short, unions declined because unionized companies couldn’t compete with nonunionized ones.

My favorite response to that column came from a Swedish emailer who darkly intoned that someone had clearly paid me to write it. He was, of course, correct: I didn’t write it for free.

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