Providence Journal, June 1, 2008: Lower-wage earners receiving most benefits from unions

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By Andy Smith

Journal Staff Writer

A study by the Center for Economic and Policy Research, an independent, nonprofit research and advocacy group based in Washington, D.C., found that the economic advantages of belonging to a union are greater for lower-paid workers.

Nationally, wages for union members average 11.9 percent more than wages for comparable workers who do not belong to a union. The study, which covers the period between 2003 and last year, calculates the unionized share of the national work force at 13.9 percent, a figure that includes people who do not belong to unions but are still covered by union contracts. Under that standard, Rhode Island۪s percentage of unionized workers in the report is 16.7 percent.

According to the center, economic data has long supported what it calls “a wage premium” for unionized workers. In a study titled “The Union Wage Advantage for Low-Wage Workers,” economist John Schmitt broke down workers by income, and he found that the advantage of belonging to a union is higher for workers at the lower end of the economic scale.

The study divides workers into percentiles. Someone in the 10th percentile makes less than 90 percent of all workers. A median, or 50th-percentile worker, is in the middle of wage distribution, with half of all workers making more and half of all workers earning less. And a worker in the 90th percentile makes more than 90 percent of all workers.

Looking at national statistics from 2003 through last year, the study found that union workers in the 10th percentile enjoyed a 20.6-percent advantage over their nonunion counterparts, but a worker in the 90th percentile had only a 6.1-percent advantage.

Schmitt said workers at the bottom end of the wage scale have the least amount of bargaining power, and even a small gain won through a union represents a proportionately larger increase in their salary than for, say, members of an airline pilots union. Schmitt said the estimate of the union premium is a conservative one, because it does not include the improved health benefits and retirement plans that also come with union representation.

In Rhode Island, the study found, the union premium is slightly smaller than it is in the nation as a whole, with an average wage increase of 11.5 percent as opposed to the national average of 11.9 percent.

For Rhode Island workers in the 10th percentile, the union premium is 15.4 percent, compared with 20.6 percent nationally. For workers in the 50th percentile, it۪s 13.5 percent, compared with 13.7 percent nationally, and for highly-paid workers in the 90th percentile, the Rhode Island union premium is 4.5 percent, compared with 6.1 nationally. The sample size in Rhode Island was 15,700 workers.

Schmitt said he۪s not familiar with the Rhode Island economy, and didn۪t have specific answers as to why the union wage premium here was smaller than the national average

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