Union Benefits Go Far Beyond the Workplace

By on February 5, 2019

From The Nation:  Organized labor has been through a tough half-century, as deindustrialization, economic deregulation, and an all-out right-wing attack have decimated union membership across the country. But new research shows how the benefits of organized labor extend far beyond union members’ paychecks: Unions also help fortify the social safety net and push workers’ families and communities toward long-term self-sufficiency.

According to a study by University of Minnesota researchers on the effects of union membership on Uncle Sam’s balance sheets, unionized workers overall contribute more in tax revenue, rely less on welfare, and secure more sustainable jobs. The analysis, which tracks tax and income data from 1994 to 2015, shows a clear immediate payoff: union members’ average yearly income (about $48,000) is roughly $7,400, or 16 percent, more than what nonunion workers earn. In turn, these higher-earning workers also depend less on benefits like food stamps or cash assistance.

Surveying wage trends from 1994 to 2015, for workers and the public purse, “union membership raises private income, lowers public-benefit use, and increases taxes paid, yielding a positive net fiscal impact.” Adding up the net worth of federal benefits programs, including unemployment insurance, cash assistance for poor families, food stamps, disability, and Social Security—which average around $1,400 each year per worker—are basically replaced with added private income negotiated through union contracts. Unionized workers had greater economic security, using about 23 percent less than nonunion peers in public benefits (about $336 annually).

Conversely, the trend of declining wages in recent years has driven increased welfare use among many formerly middle-class workers. In foundering blue-collar mainstays like manufacturing, the researchers observe, “as unionization erodes, working families’ ability to stay clear of the public safety net erodes.” Rising economic frustration has sparked movements such as the Fight for 15 campaign, which blame “nonunion employers’ low pay and meager benefits for making working families reliant on public insurance programs.”

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