from ’15 to $15: the state of the unions in california and ... · 7 the state of the unions in...

From ’15 to $15: The State of the Unions in California and its Key Cities in 2015

Patrick AdlerChris TillyTrevor Thomas

September 2015

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THE STATE OF THE UNIONS IN 2015


Executive SummaryIntroducing From ’15 to $15The Minimum Wage and Unionization in California’s Cities Unions and the $9 Dollar Minimum Wage

Unions and the $15 Dollar Minimum Wage

The Impact of the Fifteen Dollar Minimum Wage

The State of the Unions in 2015 Unionization over Time

Unionization by Sector

Unionization by Demographic Group

Bibliography

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Table of Contents

Design and DTP By

Nikola Vucicevic ADDesigner and Gentleman www.desigerandgentleman.com

Acknowledgements:We thank Brittney Lee, Veronica Gnandt , Andrea Arias and Phil Hampton for their support of this report.

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Executive Summary

IRLE’sStateoftheUnions2015startsbyconsideringtheimpactsofthefifteendollarminimumwageonLosAngelesandSanFrancisco.Proposalstoexemptunionsfromtheminimumwageprovisionwillnotmakeadiffer-encetothemajorityofunionjobs,whichtendtopaywellaboveregulatedpricefloors.Theminimalemploymentdislocationassociatedwiththenewwagewilllikelybeconcentratedinthehospitalityandtrade(includingretail)sectors.Thoughonemightexpectaminimumwageincreasetoreducethevalueofunionizationtoworkers,anincreaseinthewagefloormaywellinsteadnudgeunionizationratesabovetheirhistoriclowsthroughreducingemployers’ incentives to oppose unionization.

Other current changes in the state of California unions are limited. Union membership remains most common in the public sector. Given their disproportionate concentration in jobs such as education and health care, women,blackworkers,andthecollege-educatedareparticularlylikelytobeunionized.California,LosAngeles,andSanFranciscohaveseenunionizationlevelsdipsince2014,butthoseratesremainwithintheirrangeoffluctuationoverthelasttwentyyears.

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Introducing From ’15 to $15

IRLE’s State of The Union Series explores changes in union membership and composition from year to year. PublishedannuallyonLaborDay,initwepresentunionactivitycalculationsforCalifornia,itslargesttwourbanareasandthenationasawhole

(1). Our report is in part a reference, devoted to information on:

• The unionization rate in Greater Los Angeles, Greater San Francisco, California and the United States • Howunionizationdiffersbyage,ethnicity,educationalattainmentandimmigrationstatus. • Howbenefitstounionizationvaryacrossourareasofinterest • Howunionmembership,compositionandcompensationischanging.

Theseestimateswillnotalwayslendthemselvestoheadlinesorhyperlinks.Theretendtonotbestatisticallysignificantswingsinunionactivityfromyeartoyear.Wecanguaranteethattheyarecurrentandreliableestimateofunionactivityin2015.Theydrawfromthemostextensiveannualsurveyoflaboractivityinthecountry,theCurrent Population Survey, and are reported at key geographic scales. They provide key context about unions and the unionized intended for policymakers, researchers, community organizers, and most importantly, concerned citizens.

InSOU’spasttwoeditions,ithascomplementeditsbasic,census-typeanalysisofunionparticipationwithin-depth analysis of special topic areas. SOU 2013 considered the long-term impacts of the so-called ‘Great Reces-sion’onunionparticipation,whilelastyearweinvestigatedhowunionsfunctiondifferentlyinGreaterLAandGreat-erSanFrancisco.Ourfocusthisyear,inthefirstpartofthisreport,isonhowtherecentmovementtowardafifteendollarminimumwagepromisestoaffectunionizationinCalifornia.

1ThisreportisbasedonanalysesoftheCEPRUniformExtractsoftheU.S.CurrentPopulationSurvey(CPS)Out-goingRotationGroup.Allanalysesinthisreportcoverafiscalyear—the12-monthperiodfromJulyofthepreviousyearthroughJuneofthegivenyear.Usingthis12-monthsystem,theauthorsanalyzeddatabeginningwiththe2015StateoftheUnionspublication.Theanalysisfor2013coverstheentire12-monthperiodfromJuly2014throughJune2015,ratherthanonlythesixmonthsfromJanuary2015throughJune2015.Unlessstatedotherwise,allyearsinthereportrefertothefiscalyear.AllresultsarecalculatedusingtheCPSsamplingweights.Thesampleincludesallemployed(butnotself-employed)civilianwageandsalaryworkersage16andover.Allestimatesinthisreportaresubjecttoamarginoferror,andthemarginishigherforestimatesbasedonsmallersamplesizes,includingmetropolitan-levelandindustrygroupestimates.Wereportestimatesasstatisticallysignificantbasedona95%confidenceinterval

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Themovetowardaminimumwageatorabovefifteendollarsactstoincreasethewagelevelacrosstheen-tirelaborforce.Giventhesustaineddropinunionizationacrossmostsectorsoverthepastfiftyyears,theserecentlegislativeeffortsshowthatworkerprotectionshavenotbeencompletelyrouted,indeedlabororganizinghasn’thad a victory like this in a long time.

Whilethesymbolismofrecentreformsisclear,whatislessobviousishowtheCaliforniaeconomywillre-spondtothenewlaws,andwhatthefifteendollarminimumwagewillmeanforunionsinparticular.Inthisreport,weopenadiscussiononthesetopics.Webeginwithastraightforwarddescriptiveanalysisofexposuretothenewlaws,examiningtheshareofunionandnon-unionjobsthatstandtobeaffectedaswellastheindustries“vulnera-ble”jobstendtobedrawnfrom.OuruniverseofcomparisonhereextendsbeyondGreaterSanFranciscoandLosAngelestoSeattle(whichisalsotransitioningtoahigherwage),ChicagoandNewYork.

Wethensegueintoamorespeculativediscussion,onwhetherthenewwagelevelwillbeaboonorabustforunionrecruitment.Herewepresenttwocountervailingnarratives.Ononehand,agrowingwagefloormightlowertheunionpremium,makingunionmembershiplessattractiveforworkers.Ontheother,itmightmakeunionizationrelativelycheaperforemployers,improvinguniondensity.Weexpectforthesecondeffecttowinoutultimately.

New in 2015: Make Your Own Figures

The2015reportismoreinteractivethaneverbefore,thankstoouronlineStateoftheUnionsPortal.Oursiteallowsuserstogeneratetheirownsnapshotsofuniondensityusingcustomizablesliders.Visithttp://www.irle.ucla.edu/publications/unionmembershiptodaytotrythesefea-turesout,readmoreabouttheStateoftheUnionsproject,andexaminepastreports.

Overthepastcalendaryear,lawmakersintheCityofLosAngeles,theCityofSanFrancisco,andtheun-incorporatedareasofLACountyhaveallresolvedtoraisetheirminimumwagetofifteendollarsanhour.Similarproposals are also under discussion in Culver City, Santa Monica and other key jurisdictions in Southern California and The San Francisco Bay area.

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The Minimum Wage and Unionization in

California’s Cities Thestate’sunionsectorhasshiftedslowlyin2015butpoliticaldevelopmentsportendsubstantialchanges.LastNovemberafifteendollarfloorwasapprovedinaSanFranciscoreferendum.InMay,theLACityCouncilap-provedabilltoincreasethecity’sminimumwagetojustover$15.InJuly,theLACountyBoardofSupervisors,whichequalizedthecity’swageflooracrossthecounty’sunincorporatedareas.Elsewhere,smallermunicipalities(WestHollywood,SantaMonica)areconsideringsimilarmoves,whileTheUniversityofCaliforniaRegentshaveapprovedtheincreaseacrossallUniversityproperties.The$15wagehasfurthermorebecomeanationalproposition.Califor-nia’sinitiativescloselyfollowaSeattlelaw,andlawmakersinNewYorkandChicagoarealsoconsideringthemove.WhilenoteveryjurisdictionintheSanFranciscoandLosAngelesmetroareaswillofficiallyadopta$15wage,itwilldirectlyapplytomostworkersandbecomethesymbolicfloorfortheseregionsasawhole.

Thelivelypublicdiscussiononthe$15minimumwagehastendedtofocusonhowitwillaffectemploy-ment.Researchersandpolicymakersaredividedonwhetherlocaleconomiescanabsorbthechange.Advocatesbelievethatincreasesindisposableincomeforminimumwageworkerscancounteractlowerdemandforgoodsandservicesthataresuretobemoreexpensive.Skepticsbelievethatjobslosseswillbetoogreat,particularlyfortheyoungandunder-integratedworkerswhoaresupposedtobenefitthemostfromhigherwages.Eachgroupcanclaimtobeconcernedaboutincomeinequality.Theformergroupbelievesthatoldminimumwagelawsexacerbateinequalitybyloweringtheamountthatworkerstakehome,thelatterthathigherwagesincreasethegapbetweenthefullyemployedandeveryoneelse.Untiltheemploymenteffectsofthenewlawscanbeobserved,adegreeoffaithwillberequiredtodiscusstheemploymenteffectsoftheselaws.

Amongthewidersocialwelfarediscussions,theimpactofahigherminimumwageonunionizationhasbeenneglected.AnexceptionwouldbethequestionbeforetheLACityCouncil,ofwhetherthecity’sunionsshouldbeexemptedfromtheminimumwagelaw.Supportersarguethatunionizedworkershaveprotectionfromanotherquarterandshouldbefreetonegotiatefortheirpreferredcombinationofwages,benefits,andjobssecurity.Oppo-nents consider it unfair on principle.

Theunionexemptiondiscussionbegsseveralquestions.Evenifexemptionsarenotgranted,howmanycurrentunionjobspaytheminimumwageanyway?Also,howmanyadditionaljobsstandtobeaffectedbya$15wage;totheextentthattherearedeleteriousemploymenteffectsfromwageincreases,howmanycurrentjobsareexposed?Thesetopicsmotivateourinitialdiscussion.

OuranalysisreportsdatafortheLosAngelesandSanFranciscoConsolidatedStatisticalareas(CSAs)and

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competitors. Because the labor market is generally agreed to extend over city boundaries, and because core city wagesaffectwagesinoutlyingareas,theregionalunitofanalysisisappropriate.However,themismatchbetweenthelabormarketandlocallawsshouldbekeptinmind,whenanticipatingminimumwageeffects.Somelocalcitiesmightholdoutfromequalizingtheirminimumtothepredominantlevel,howeverapreponderanceofworkersineachplaceshouldexpectlargewageincreases.

Unions and the $9 Dollar Minimum Wage

Figure 1: Share of Workers Earning $9/hour or Lower (All Workers, Including Tips)

California’sminimumwagein2015(2)was$9anhourforallnon-exemptworkers.Althoughsomeclasses

ofworkers:salespeople,familymembers,andapprenticesareexemptedfromthisprovision,itshouldbeconsid-eredtheState’scurrentwagefloor.

Figure1showstheshareofunionandnonunionworkerswhoearnwagesatorbelowninedollarsanhour,inLA,SanFrancisco,Californiaandthenationatlarge.LosAngelesstandsoutforitsshareofminimumwagework-ers.Afull6.5%ofnonunionworkersearnthelowestwagespossible,amuchhigherratethaninthenationasawholewherethewagefloorisamuchlower$7.25.SanFranciscoandSeattlehadminimumwageshigherthan$9,SanFranciscoduetolocalordinances(SanFrancisco’sminimumwagewas$12.25beforemovingtowards$15),andSeattleduetostatewidelaws.Theirlowbutpositivebelow-$9workforces,reflecttheextentofexemptions.InNewYorkandChicago,where$9anhourishigherthantherespectivestate-wideminimumsof$8.75and$8.25,fewerworkerswereemployedatthatlevelorbelow,thaninLosAngeles.

2Thestatewideminimumwillincreaseto$10inJanuaryof2016.

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Figure 2: Percent of Greater LA Workers Earning $9/hour or Less, By Industry

LA’slowestearningworkerscomefromsectorsthatareusuallyassociatedwithminimumwages(SeeFigure2).Over10%oftheregion’shospitalityworkersandnearly8%ofitsretailandtradeworkersearnninedollarsanhour.Man-ufacturingandjobsnotclassifiedalsohaveratesabovethenationalaverageforallindustries.

LA’shighshareof9dollarworkerscomparedtoNewYorkandChicago,canbeconnectedintoitsoverrep-resentationofhospitalityworkers.13.25%ofallworkersintheLAMSAworkinLeisureandHospitalityindustries,accordingto2014BLSfigures,butonly11%ofworkersintheothercitiesdo(TheexceptionisSanFrancisco,with13.2%inhospitality,almostidenticaltoLA,butthelong-termSiliconValleyboomandaccompanyinggentrificationhavemadeSanFranciscoahigher-wagecityoverall).LAalsoemploysrelativelymoreworkersinWholesaleandRetailTradeandManufacturingthetwootherindustries,withmoreunder-$9workersinthesesectorsaswell.

LA’sunionizedworkers,ontheotherhand,arenomorelikelytoearnlowwagesthanworkerselsewhere.Onlyahalfapercentofunionmembersearnthecurrentminimumwage.NewYork’sreadingisatthesamelevel,whileourestimateforSanFranciscoisactuallyzero.InChicagoandSeattle,where$9islowerthanthestatewideminimumwage,roughly1percentofunionworkersearnhourlywagesatthislevel,reflectingtheshareofexemptworkerswhoarealsounionmembers. Whentakenasawhole,Figure1showsthata$9minimumwagehasrelativelylessbearingonjobsintheunionizedsector.ThismeansthatifLAunionswerecurrentlyexemptedfromtheminimumwage,aninfinitesimallysmallnumberofunionemployerswouldtakeadvantage.Inanefforttolookahead,weturntotheshareofearnersatthefifteendollarlevel.

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Unions and the $15 DollarMinimum Wage

A$15wagefloorismuchhigherinabsoluteterms,andalsohigherthananyminimumwagecurrentlyineffect.Allregionsunderobservationhaveasignificantcohortofjobsintheunionandnon-unionsectorsthatarebelowthislevel,andareorwouldbemostexposedtoafifteendollarwage.Wewillnowdiscusshowthisvulnera-bility varies across sector and space.

Figure3showsexposureintheunionandnone–unionizedsectorsinourselectedareas.LA’snonunionsectorisonceagainoutinfront.45percentofLA’snonunionworkersearnlessthan$15dollarsin2015.ThisissixpercenthigherthanworkersinChicagoorthenationasawhole,and19%higherthanworkersinSeattleandSanFrancisco.

Figure 3 Share of Workers Earning $15/hour or Lower (All Workers, Including Tips)

UnionizedworkersarenotsubstantiallymorelikelytoearnlessthanfifteendollarsinLA.Aslightlyhigh-erproportionofunionworkersinNewYork(23.4%)andChicago(21.7%)earnlessthanfifteendollars,whilethelevelisslightlylowerinChicago(17.7%)andthenationasawhole(18.9%).SanFrancisco’slevelisnoticeablylower(14.1%).

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Figure 4: Share of Workers Earning $15/hour or Lower (Adjusted for Natural Increase) (All Workers, Including Tips

Wagesdohaveatendencytogrow,andinFigure4,weadjustthepreviousfigure,toaccountforincreaseinthewagelevelduetoinflationandeconomicgrowth.Weperformthisadjustmentusingaverysimplebenchmark:wagegrowthineachareafrom2009-2014.Theadjustmentdoesnotchangeourestimatesdrastically.Theoveralllevelofexposuredropsbybetweenlessthanoneandfourpercent,andthegapinexposurebetweenunionandnon-union jobs remains.

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Figure 5: Percent of Greater LA Workers EarningLess Than $15 an Hour, By Industry

JustasHospitalityandTradeweremorelikelytoemployLAworkersatthe$9level,soitgoesatthe15dollarlevel(Figure5).63%ofhospitalityworkersand48%ofretail/wholesaleworkersintheregioncomefromthesesectors,wellaheadofanyotherindustry.

InaccountingfordifferencesbetweenSanFranciscoandLosAngelesatthe15dollarlevel,theoverallwagelevelacrossallindustries,andnotthenumberofhotelandrestaurantworkers,seemstobemorerelevant.BayAreaincomeswere$63,000in2013,comparedto$48,000inGreaterLA.

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The Impact of the Fifteen DollarMinimum Wage

TheprecedingsetsupthreepredictionsabouthowthefifteendollarwagewillaffectunionizationinLAandSan Francisco.

1) Union wages will continue to exceed the minimum wage

Ourfirstpredictionisthatunionjobsarelikelytopaymorethanfifteendollarsanhour,eveniftheyaretechnicallyexemptedfromtheminimumwageincrease.Currentlyitisquiterareforunionizedworkerstoearntheminimum—inbothSanFranciscoandLAlessthan1percentofunionmembersgettheminimumwageorless.Whywouldunionsalariesincreasetoexceedtheminimumwage,evenwhentheyarenotlegallyrequiredto?Thequestioncanbeansweredfromtheperspectiveofunionsandemployers.

Unions are vessels for the betterment of their membership. They collect dues and promises of collective actionfrommembershipinexchangeforsalaryandbenefits.Asthesalaryfloorrises,weshouldexpectforunionstonegotiateforhigherwagesandbenefits,inordertomaintaintheirvaluepropositions. Italsomakessenseforunionemployerstomaintainwagesabovetheminimumwage,forreasonsofwork-erquality.Higherthangoingwagesmaycostfirmsmoremoney,buttheyalsoallowthemtogetbetterworkers.Bypayingmorethanthegoingrateforajob,firmscanusethewageasafilterforworkerswhoeitherhavemoreskillsorarebettersuitedtotheirjob.Economistscallthiswagepremiuman“efficiencywage”.Firmsthatcurrentlyrelyonwagepremia(whichincludemostunionfirms)tomeettheirneedswillneedtoeitherraisewagesabovetheircurrentlevels(andwellabovetheminimum)orforegoefficiencywagesaltogether.Andwhilesomefirmsmayoptforthesecondstrategy,itwouldbeamoredramaticmovethantosimplyraisepricesinconcertwiththerestoftheeconomy.

2) EmploymentEffectsWouldBeConcentratedinHospitalityandTrade

ThereisdebateabouttheimpactofminimumwagesonemploymentbutseveralrecentCaliforniastudiessuggestthatthegeneralimpactherewillbemodest.AreportbyoursisterinstituteatUCBerkeleyinvestigatestheeffectofminimumwageonpricesintheCityofLA(Reichetal.,2015), projecting that payroll costs across all indus-trieswillincreaseby3.9%bythetimethatthe$15dollarminimumisineffect.Thereportfurtherarguesthathigher

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wageswillleadtolowerturnovercosts—whicharethemselvesadragonfirmproductivity.Oncecostsavingsfromlowerturnoverareweighedagainsthigherwages,thenetimpactonoperatingcostsisprojectedtobelessthanonepercentagepoint.AsimilarreportforSanFrancisco(Reichet.al2014),alsoseesminimalimpactontotalcosts.Theseeffects,whilenotrepresentativeofallstudies,pointtopriceincreasesthatareatorlowerthanthoseassoci-atedwith‘natural’priceinflation. Economy-wideprojectionsdotendtoobscuremoredramaticimpactsforparticularindustries.Ourcalcu-lationssuggestthatadisproportionatenumberofhospitalityandtradeworkersareexposedtothewagelaw,bothitsbenefits(higherwagesanddisposalincome)anditscosts(lowerdemandandloweremployment).SimilarlytheBerkeleystudiesprojectnegativeeffectstobelocalizedintheseandafewotherindustries.CoststoFoodService,a constituent of Trade, are projected to increase by 9% in San Francisco and 20% in Los Angeles. Even once the pro-jectedbenefitsofreducingturnoverareaccountedfor,totalfoodservicecostsareexpectedballooninLA(+7.8%)andincreasebymuchmoreinSanFrancisco(3%)thantheeconomyasawhole.

Becauseemploymenteffectswouldbeconcentratedincertainindustries,wewouldexpecttheindustrialstructureofCaliforniancitiestobeimpactedbythenewlaw.Currently,ahighershareofLAandSanFrancisco’sworkforceisengagedinhospitalitythaninSeattle,Chicago,NewYorkorthenationasawhole.Ifworkersherearedisplacedmorethaninothersectors,thenitprobablywon’tbebecausedemandistransferredtolocationswithcheaper costs. San Francisco’s Embarcadero and LA’s Walk of Fame are unique attractions that should continue to beattractivetotourists.However,wemightstillexpectthesecities’workforcestobecomelesshospitality-intensive,eitherasfewerworkersareaskedtodomoreaswagesincrease,orastechnologyreplacessometourismfunctions

Weshouldnotexpectspecializationsinotherindustries(e.g.entertainmentinLA,informationinSanFran-cisco)tobeasimpactedashospitality.Laborcostsintheseindustriesarealowershareofindustryoutputthaninhospitalandtrade,profitsaremuchhigher,andrevenuesarepredictedtogrowmore.Thereisandwillcontinueto

3Thesereportsdonotmodeltheeffectofgreaterlocalconsumerdemandonemploymentlevels.ArecentUCLAIRLEreport(Flamingetal.2015)explorestheseeffectsprojecting$5.9Billionofadditionalincomewhich,wouldbelargelycirculatedlocally.Ontheotherhand,therearemorepessimisticprojectionsofoverallemploymenteffectssuchas,forLA,Thornbergetal,2015.

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bemorewagestogoaroundintheserelativelylucrativeindustriesthanelsewhereineconomy.Effortstomitigateemploymenteffects,ortoaidthoseimpactedneedtobeappropriatelytargeted.

3) Unions should be more attractive under a higher minimum wage

Finally,theminimumwageincreasemightspuronincreasedunionization.Whenweconsiderthedecisiontounionizeasworker-driven,thiseffectseemscounter-intuitive.Anincreaseinthewagefloorforallworkerswouldseemtoimproveconditionsforworkers,withoutanaccompanyingcostforuniondues.Workerswhopreviouslymighthavepreviouspushedfortheirfirmstounionizesothattheycouldmakeafifteendollarwage,willnolongerhave to do so.

However,theemployerperspectiveisquitedifferent.Currently,unioncampaignsarewidelyopposedbyfirmsbecausetheyrepresentincreasedcoststodoingbusiness,andsuchoppositionissogreatthata“union-avoid-anceindustry”hasemerged(Logan,2006)todampenorganizingefforts.Asthegapbetweenwhatanemployerwouldpayunionworkersandwhatitisrequiredtopaythembylawshrinks,itbecomesless-costeffectivetoop-pose unionization on the employer side.

Whicheffectdoweimaginewillbemorepowerful—theindividualeffectorthefirmone?Theanswerde-pendsonwhyunionizationisatitscurrent,historicallylowlevels(SeePart2ofthereport).Ifit’sbecauseworkersdon’tfindunionsattractive,thenthenewlawmightonlyexacerbatethecurrentunioncrisis,butsurveysofunionsentimentsuggestthataclearmajorityofnon-unionizedworkers(~55%)wouldvoteforformingaunionifgivenanopportunity(FreemanandRogers,2006).Thatunionizationratesarewellbelowthisnumber,andthatthereisalargeunionavoidanceindustrytobeginwith,wouldsuggestthatfirmattitudestounionsaremoresignificanttotheoverallrate.Asunionsbecomecheaper(andthusmoreattractive)foremployerswemightexpectfortheunioniza-tionratetotickupwards.

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The State of the Unions in 2015

Unionization over Time Theunionparticipationrate,alsoknownasuniondensity,isthebasicmeasureofunionactivity.Itcapturesthepercentageofanarea’sfulltimeworkforcethatholdsaunioncardatagiventime.Figure6showshowuniondensity has changed over the past eighteen years.

Californiaanditskeyurbanregionshavefluctuatedaroundthesameunionlevelfortheentireperiodunderstudy,stayingbetween15%and16.5%formostofthatperiod.Thenationasawholehasseenamoresustaineddecline in its rate from 14.4% to 11.3%.

Figure 6 Union Density in Los Angeles, San Francisco, California and the United States: Fiscal Years1997-2015

Ourreportwillnowturntobasicestimatesofunionization.ThesestatisticsrepresentthebestandmostcurrentestimatesofunionactivityinCaliforniaanditskeyeconomicregions.

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Our data come from a sample of respondents to the Current Population Survey, and not a more compre-hensivesourceliketheUSCensus.Assuch,yearoveryearchangesthatappeartobesignificantcanbeindistin-guishablefromstatisticalnoiserelatedtochangesinsamplecomposition.OurestimatesshowthattherehasbeenadeclineinunionizationratesinCaliforniaitstwolargesturbanregionsandthenationasawhole.Ofthese,onlyLA’sdropfrom16.5%to14.8%isstatisticallysignificant.California’syear-overyeardrop(1.9%)isnotsignificantbutitsestimatedunionizationlevelisthelowestinthestudyperiod.ThesamegoesfortheUSasawhole,wheredensi-tyappearstohavereturnedtoanewlow,afteraspikein2013.

Unionization by Sector

ThesourcesoffluctuationsinuniondensityarehardtodivinefromFigure6.Wecanstarttounderstandthedynamics behind union density by disaggregating the overall unionization rate by sector. We start this analysis by comparing public and private union density.

Figure 7 Union Density by sector in Los Angeles, San Francisco, California and the United States

DensitieswouldbeconsiderablylowerinCaliforniaandthenationwereitnotforpublicsectorunions.InCaliforniaanditstwolargesturbanregions,morethanhalfofallpublicsectorsareunionized(SeeFigure7.)Asmaller1/3ofAmericanpublicworkersareinunions.Theprivaterateineachjurisdictiondoesnotexceed10%.

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Figure 8: Percentage Unionized by Sector in LA and San Francisco: 1997-2015

LA’s drop in overall unionization appears to have been driven by changes in the private sector. While its publicsectorrateactuallyincreasedby2.2points,anamountthatisnotstatisticallydifferentfromzero,itsprivatesectorratedroppedbyasignificant1.2percentagepoints

(4).Justastherehavebeennosignificantchangesinthe

overall unionization rate in the other areas, private and public sector rates have also held steady.

Figure8showschangesindensitybysectorsince1997inGreaterLAandGreaterSanFrancisco.Whilepri-vatesectordensityappearstohavedippedslightly,unionshavemadesignificantpublicsectorgains.Atthebegin-ningofourstudyperiod,themajorityofpublicsectorworkerswerenotunionized,nowtheyaremorelikelytobeinunions.

4Thelargerchangeislessstatisticallysignificantbecauseitisbasedonasmallersamplesize,whichreducesthereliabilityoftheestimate.

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5InthisanalysiswecomparedensitiesattheMetropolitanStatisticalArea,asmallerunitthanintherestofthere-port.TheSanFranciscoMetropolitanarea(officiallycalledtheMetropolitanStatisticalArea)includesOaklandbutnotSanJose,Vallejo,SantaRosa,StocktonorNapa.TheLAMetroareaincludesLongBeachandOrangeCountybutnotRiversideorOxnard.AssuchMSAandCSAestimateswilldiffer.

ThepublicsectororientationofmodernunionsisconfirmedinFigure9.Herewecomparepublicandpri-vateorientationinsmallermetroareas(Sacramento,SanDiego,Fresno)andtheLAandSanFranciscometroareas

(5).

FresnohasevenhigherpublicsectorunionizationthanLAandSanFrancisco(72%).ThepublicsectorisrelativelylargeinSacramentocomparedtoLA,butthetwoplaceshavesimilarpublicsectorrates.SanDiego’spublicsector(43%)andoverall(13%)uniondensitiesarelowerthanintheothermetros,andinthestateasawhole.TherewerenosignificantchangesinMSA-levelunionizationbetween2014and2015.

Figure 9: Union Density in California Metropolitan Areas versus Statewide Average

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Figure 8: Percentage Unionized by Sector in LA and San Francisco: 1997-2015

Toexplorevariancewithintheprivateandpublicsector,wecompareunionizationbyindustrygroup(SeeFigure10).Theindustriesdominatedbypublicsectorwork:PublicAdministration,EducationalServices,andHealth-care and Social Services, and Transportation and Utilities all see above-average densities in each area.

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Constructionisalargelyprivatesectorindustry,withhigherthanaveragedensitiesinCalifornia,itskeycitiesandthenationasawhole.Inthenationasawhole,manufacturingismoreunionizedthanaverage,butinCaliforniaand its regions it is less so. LA’s entertainment industry, a key portion of its labor force, is much more unionized thanentertainmentinSanFrancisco,thestateorthenation.Thewhite-collarindustriesofFinance,InsuranceandRealEstateand“Other”(asegmentthatincludestechnologyindustries)arerelativelylessso. Sincelastyeartherehavebeensignificantdropsinsomeindustrieswithinsomeareas.InLosAngeles,Transportation and Utilities unionization appears to have dropped by 9.5%. In San Francisco, density dropped in threewhitecollarindustries:Entertainment(-9.23points),PublicAdministration(-5.27points)andEducationalSer-vices(-4.7points).ThesameroughstoryappliestothestateasawholewhereEntertainmentdropped4.4points,Public Administration dropped 13.5 points and Educational Services 7.1 points. Such drops do not necessarily point tolowernumbersofunionizedworkersintheseindustries.Itseemsmoreplausiblethatthenon-unionportionsoftheseindustrieshavegrown.What’smore,aportionofthesechangescouldbeattributedtorandomchangesinthesamplethatdonotreflecttruechangesintheworkforceasawhole.

Twosectorssawsignificantgrowth.ConstructioninSanFranciscogrewby7pointssincelastyear,whileWholesale/Retailtradeinthestateasawholealsogrew.Furtherresearchwillhavetodeterminethesourceofthesegains.Ononehand,declinesineithersectormighthaveadverselyaffectnon-unionworkers;ontheotherthenumbers might point to successful union organizing.

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Unionization by Demographic Group

Unionizationcanvarysignificantlyacrossdemographicgroups:gender,race,educationandimmigrantsta-tus.Belowweconsiderdifferentlevelsofuniondensityfordifferenttypesofworkersinourareasofinterest.

Figure11showsthatunionmembershipisactuallyrelativelyevenlydispersedacrossthetwodominantgen-ders.DifferencesbetweenmenandwomenarenotsignificantlydifferentfromzeroinCalifornia,LAortheNationasawhole.WomeninSanFranciscoareactuallyslightlymorelikelytobeinunionsthanmen(18%versus15%).ThismayhavetodowiththefactthatmoreofSanFrancisco’sworkforceisengagedinHealthcareandSocialSer-vices(AdlerandTilly,2014)thanintheotherplaces,butshouldprobablynotbeoveremphasized.Therehavenotbeensignificantchangesinmaleorfemaleunionizationsince2014inanyofthestudyareas.

Figure 11: Unionization Rates by Gender, 2015

Ethnicityandgeographyinteracttoproducemorevariation(SeeFigure12).AfricanAmericansappeartohavehigherunionizationratesacrosseacharea,butthisisparticularlytrueinLAandSanFrancisco,wherealmostaquarter of African Americans are part of unions. White unionization rates are very close to average in each jurisdic-tion,whileratesforAsiansareslightlybelowaverageandratesforLatinosarelowerstill.

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Sincelastyear,therehasbeenonesignificantchangeinunionizationbyethnicity:AfricanAmericanunion-ization seems to have dropped by almost 10% in California. More investigation is need to identify a cause for this, butitwouldseemtobedrivenbyareasoutsideofSanFranciscoandLosAngeles,wheretherewasnotasignificantchange in African American participation.

Figure 12: Unionization Rates by Race/Ethnicity, 2015

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Figure 13: Unionization Rate by Place of Birth

Whywouldimmigrantsfromdifferentplaceshavedifferentunionizationrates?Figure14pointstooneex-planation.Itshowsthatcitizensaremorelikelythannoncitizenstobeinunions,andthatlongertenuredimmigrantsarealsomorelikelytobeinunions.Becauseimmigrationtendstooccurinwaves,weshouldexpectforsomecorrela-tionbetweenwhereagroupisfromandhowlongmembersofthatgrouparelikelytohavebeeninthecountry.

Unionstendtorelyontenure.Benefitstounionparticipationtendtoincreasewithtenuresothatthelongeranimmigrantisatafirm(andthusinthecountry)themoreincomeandbenefitstheyarelikelytoenjoy.Thecorrelationbetweenunionmembershipandimmigranttenureiscomplementedbytherelationshipbetweenageandunionstatus(SeeFigure15).Youngworkers,whohavelesstenureinthelabormarketaresignificantlylessunionized than average in each geographic area. The numbers are closer to average in the 25-54 age range- the coreofone’sworkinglife,andhigherforworkerswhoare55andover.Youngworkersarealsotransient:migratingmorefromplacetoplace,jobtojob,andfirmtofirm,anattributethatwouldalsopredictfeweropportunitiestounionize, and less of an interest in doing so.

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Figure 15: Unionization Rates by Age, 2015

Acrossallagegroups,andgeographiestherewerenosignificantdifferencesbetween2014and2015.Figure16confirmsthataverydifferentkindoftrait,educationalattainment,isitselfastrongpredictorofwhethersomeonewillbeunionized.Thereappearstobeacontinuousrelationshipbetweendegreestatusandunionmem-bership.Thosewithoutahighschooldegreearelesslikelytobeinunionsthanthosewithonlyahighschoolde-gree,andthosewithsomepost-secondaryexperiencebutnocollegedegreeareevenmorelikelytounionize,whilethosewithcollegedegreesarethemostlikely. TheleasteducatedworkersinSanFranciscoaremoreunionizedthanintheotherthreeplaces,whilework-erswithcollegedegreesarelessso.ThisislargelyrelatedtoTheBay’sindustrialstructure.Theregion’stechjobsdemandmanyofthedegreedworkersinSanFrancisco,andtheseareinlessunionizedsectors.LA’sentertainmentsectoriscomparativelymoreunionized(SeeFigure10),andhastraditionallybeenabasefororganizedlaborinthearea.Theonlysignificantyear-over-yearchangewasatthehighschoollevelinSanFrancisco,wheretheratedropped by 6.4 points.

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In summary, patterns of unionization in California and its largest cities in 2015 for the most part continue tofollowlong-standingtrends.Publicsectorworkers,women,andblackworkersaremorelikelytobeinunions.Immigrantshavelowerratesofunionization,butthoseratesincreasewithtimeinthecountryandacquisitionofcitizenship.Olderandmoreeducatedworkersaremoreoftenunionmembers.Californiaanditsmajorcitieshavehigherratesofunionizationthanthenationasawhole,andthatgaphaswidenedbecauseGoldenStateunionden-sityhaschangedlittleoverthelast20years,whiletheUSratehasfallensteadily. ThoughthesefeaturesofwhoandhowmanyareinCaliforniaunionshavechangedlittlein2015,thedramaticadoptionof$15minimumwagesbySanFranciscoandLosAngeles,alongwiththelikelihoodthatneigh-boringcommunitieswillfollowsuit,markanimportantnewdevelopment.Thenewminimumwageordinancesareimportantvictoriesforunions(alongwithbroadereconomicjusticecoalitions)inthesecities.Thoughitistooearlytotellhowtheywillaffectunionizationrates,therearegoodreasonstoexpecttheywillfacilitateunionization.BoththepoliticsandtheeconomicsofthesenewminimumwagelawsopenanewchapterinthestateoftheunionsinCalifornia.

Figure 16: Unionization Rates by Education in California and the United States 2015

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Bibliography

Bureau of Labor Statistics.(2015).QuarterlyCensusofEmploymentandWages-LocationQuotientCalculator.Retrievedfromhttp://data.bls.gov/location_quotient/ControllerServlet

Freeman, R., & Rogers, J. (n.d.).Whatworkerswant(2nded.).CornellUniversityPress.

Logan, J.(2006).TheUnionAvoidanceIndustryintheUnitedStates.BritishJournalofIndustrialRelations,44(4),651–675.

Reich, M., Jacobs, K., Bernhardt, A., & Perry, I. (2014).SanFrancisco’sProposedCityMini-mumWageLaw:AProspectiveImpactStudy.InstituteforResearchonLaborandEmploymentUniver-sityofCalifornia,Berkeley.Retrievedfromhttp://irle.berkeley.edu/cwed/briefs/2014-04.pdf

Reich, M., Jacobs, K., Bernhardt, A., & Perry, I.(2015).TheProposedMinimumWageLawforLosAngeles:EconomicImpactsandPolicyOptions.InstituteforResearchonLaborandEmploymentUniversityofCalifornia,Berkeley.Retrievedfromhttp://irle.berkeley.edu/cwed/briefs/2015-01.pdf

Thornberg, C., Levine, J., Schrader, J., Vanderplas, B., & Saia, M.(2015).Cost-BenefitAnaly-sis:LosAngelesMinimumWageProposal.Retrievedfromhttp://www.lachamber.com/clientuploads/pdf/Beacon%20Minimum%20Wage%20Report%202015.03.18_Final.pdf

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