1. 1 What is the Union Wage Premium for RNs? Michael Ash, Ph.D. University of Massachusetts at Amherst Joanne Spetz, Ph.D. Jean Ann Seago, Ph.D., R.N. University of California, San Francisco June 2008

2. 2 Union influence in health care is growing Increasing rate of unionization among health care workers Aggressive bargaining for contracts Efforts to change state and national policies Conflicts and competition between unions Nearly 21% of hospital-employed RNs were in unions in 2006

3. 3 What do unions do? Seek to divert employers’ net revenues (profits) to workers Wages Benefits Working conditions Unions are associated with wage premiums Public sector unions have smaller wage premium Wage premium has declined over past 2 decades Premium decline smaller in health industry

4. 4 Union growth in health care Nationwide, industry-wide decline in private sector membership since 1950s Increase in public sector membership (40% by 1986) Healthcare unions grew rapidly in 1970s NLRB rules were extended to nonprofit sector States passed laws that favored unions in public sector in 1970s and 1980s

5. 5 Union growth in health care Healthcare union growth slowed in 1980s NLRB began to determine bargaining units on a case-by-case basis All hospital professionals were usually put in a single bargaining unit Resurgence of growth in early 1990s New NLRB rules in 1989 that allow 8 separate groups of hospital employees to have units Managed care growth & declines in working conditions spurred union growth

6. 6 Hospital RN unions grew more after 1995 Unionization = ~18% ~21% 19851990199520002005 0.16 0.17 0.18 0.19 0.20 0.21

7. 7 How do unions affect hospital RN wages? Research from 1970s and 1980s find wage increases for RNs Some evidence that non-union wages are affected by union wages Union power vs. union threat This study: Current Population Survey data, 1983-2006

8. 8 Characteristics of hospital RNs Non-UnionUnion Hourly earnings$25.87 (0.10)$29.55 (0.24) Immigrant11.8%22.4% Urban residence82.5%88.8% White79.6%67.5% Assoc. Degree37.1%33.6% Bachelor’s Deg.48.3%51.1% Age41.6 (0.1)43.0 (0.2)

9. 9 How to estimate the wage premium Ordinary least squares Hourly wages = weekly earnings/weekly hours Education (not necessarily nursing) Potential experience (age - 6 - years of ed) Citizenship, immigration (1994 onward only) Race/ethnicity, gender 18 regional dummies (9 census x urban/rural) Time dummies Union x time = yearly union premium

10. 10 Estimated union wage premia over time 19851990 199520002005 0.15 0.10 0.05 0.00 Wage premium No region dummies With region dummies Premium jumps after 1995

11. 11 Wages for hospital RNs over time 19851990 199520002005 $20 Median Real Wage Union wage Non- union wage Shortage period Surplus period $22 $24 $26 $28 $30 NLRB rule eases unionization

12. 12 What has happened? Higher union premium after mid-1990s All wages grew until 1991 Non-union wages stagnated 1991-2001 Union wages continued to grow (slowly) during this period Union premium grew over this period NLRB rules made unionization easier in early 1990s All wages grew after 2001

13. 13 Union threat and power Union density (share of RNs unionized in a region) can affect wage premia Union power: if higher density gives unions more power, they can use power to increase wage gap More likely when supply is constrained Union threat: If higher density makes employers fearful, non-union employers may raise wages to match… the wage gap will be smaller More likely if unionization is easy

14. 14 Union density vs. wage premium 2000-2006 (state-level) 0 0.1 0.30.4 0.50.60.70.2 Union density 0.15 0.10 0.05 0.00 -0.05 -0.10 -0.15 Wage premium

15. 15 Union density Union density vs. wage premium 2000-2006 (by region) 0 0.10.20.30.4 0.10 0.05 0.00 Wage premium

16. 16 Evidence supports union threat Positive correlation between union wage gap and union density Correlation = 0.64 at regional level Correlation = 0.27 at state level As union density rises, unions have greater power to increase their RNs’ wages relative to non-union RNs

17. 17 Union density Change in non-union real wage, pre-1994 vs. post-1997 0 0.10.20.30.4 0.16 0.12 0.08 Change in non-union real wage 0.14 0.10 0.06

18. 18 Union density Change in union real wage, pre-1994 vs. post-1997 0 0.10.20.30.4 0.20 0.12 0.08 Change in union real wage 0.14 0.10 0.16 0.18

19. 19 Over time, union threat may play a role… but power dominates Modest relationship between union density and non-union wage growth Stronger relationship between union density and union wage growth All relationships are noisy

20. 20 Conclusions Effect of RN unions on wages over time is growing RN unions protected RN wages during a period of surplus Changes in NLRB rules may have facilitated this RN unions obtain a larger premium as their density increases