Study: Unions Boost Economic Mobility of Children

Larchmont Elem. SchChildren whose parents belonged to a union as well as those who grew up in geographic areas with high union membership climb higher up the career ladder and earn more money as adults, according to a report by the Center for American Progress (CAP).

The report was released Wednesday at CAP headquarters in Washington, D.C., accompanied by a panel discussion which included former U.S. Secretary of the Treasury Lawrence Summers, Richard Freeman, co-author of the report and an economics professor at Harvard University, and CAP managing director of economic policy and report co-author, David Madland.

Unions are a significant predictor of economic mobility even after controlling for variables including race, industry type, education level of parents, and other factors, said Madland, during his presentation of the report, Bargaining for the American Dream: What Unions do for Mobility.

“We found that regions with greater union density had higher mobility for low-income children,” Madland said. “We also found that having a union parent leads to better educational and health outcomes for children.”

The authors, including Wellesley College Professor Eunice Han and CAP policy analyst Brendan Duke, identified this intergenerational union effect as being stronger for less-educated and less-skilled parents. Previous economic studies were referenced by the authors, Madland said, particularly one that employed five factors showing the strongest geographical relationship with mobility: single motherhood rates, income inequality, high school dropout rates, social capital, and segregation.

The CAP report may be the first, according to researchers, to examine the relationship between mobility and another variable that had not been considered: union membership.

“Researchers have produced a plethora of studies on how falling union membership has increased income inequality, and this report will hopefully inspire others to examine the relationship between unions and mobility,” according to the authors.

One of the challenges facing the U.S. today is the need to reduce income inequality and increase economic mobility, said Freeman.

“As the country is trying to reduce inequality and certainly stop it from growing, the absence of strong unions makes that so much harder,” he said.

According to the report, unions advocate for policies that benefit working people, such as minimum wage increases and increased expenditures on schools and public services.

“There is someone who speaks for everyone but for the middle class,” said Summers, referring to politicians and other national leaders. “Traditionally, the labor movement spoke for the middle class.”

The findings show that children growing up in union households tend to have better outcomes than children who grew up in nonunion households, especially when the parents are low skilled. For example, children of non-college-educated fathers earn 28 percent more if their father was in a labor union. This analysis helps provide evidence suggesting a link between unions and economic mobility.

“We need to look at what unions have done historically to help families,” Freeman said.

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The report finds that there are direct effects that a parent’s union membership may have on their children. For example, union workers make more money than comparable nonunion workers, known as the “union premium.” As such, offspring of union parents benefit. Also, union jobs may be more stable and predictable, which could produce a more stable living environment for children, who are more likely to have health insurance as a result of their parents’ family plans.

According to the report, a union presence potentially helps all children since nonunion workers often experience wage increases due to the gains negotiated by their union colleagues. Still, resistance to union organizing is prevalent among public- and private-sector workplaces.

“I think, no one could argue that the assistance to resistance of unionization during Republican administrations has not been successfully offset by anything that has happened during Democratic administrations,” said Summers. “That has contributed in an important way to the decline of private-sector unionism.”

Summers pointed to education policies surrounding charter schools as an example of ill-conceived public policy that used taxpayer dollars to serve only a privileged few.

“There are never going to be enough charter schools for one-quarter of kids let alone for all kids,” he said. “This is not a credible response to the challenges of the economy in 2015.”

In addition, outdated organizing models that have “not fully adapted to the changing nature of the workforce,” are also keeping union membership down, said Summers.

“It is a workforce in which there are more people who work flexible schedules, {and where} workers think of themselves as working in partnership with employers, and where there are more pink collar and white collar workers than blue collar,” he said. “There has not been full adaptation on the part of those seeking to organize to all those realities.”