NCPA - National Center for Policy Analysis

Unions Revive Wage Issues

September 3, 1999

For the first time in many years, organized labor is focusing much more on economic gains for its members, while also pursuing broader job security goals, labor experts report. Some unions are winning big pay gains -- raising the prospect of wage inflation.

Nevertheless, analysts caution that it is still too soon to declare the era of muted wage gains over.

  • The typical union contract negotiated in the first half of this year called for first-year pay increases averaging 2.7 percent, according to the Bureau of National Affairs -- up from 2.4 percent in the first half of 1998.
  • The Labor Department says that unit labor costs rose at an annual rate of 4.5 percent in the second quarter of this year.
  • While this represented the largest such jump in five years, experts cautioned that the number fluctuates significantly from quarter to quarter.
  • The Teamsters, United Auto Workers, and the International Association of Machinists and Aerospace Workers are among the unions concentrating on wage issues.

Cornell University industrial relations professor Harry Katz says that labor has had the most success in industries that are both heavily unionized and are experiencing solid economic performance -- particularly aerospace, autos, steel, trucking and the airlines.

Source: Glenn Burkins, "Organized Labor Is Seeking Big Pay Gains," Wall Street Journal, September 3, 1999.


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