NCPA - National Center for Policy Analysis

Public-Sector Unionism: A Review

May 25, 2011

In 2009, membership in public sector unions surpassed membership in private sector unions for the first time in U.S. history.  The growth in public sector unionism is part of a 60-year trend fueled by a decline in private sector union membership and the legalization of public sector unionization.  The shift in American labor unionism from a private to a public sector movement has been described as a structural break in American labor unionism with implications not for the profitability of firms but for the solvency of governments, says Eileen Norcross, a senior research fellow with the Mercatus Center at George Mason University.

The rising cost of funding public sector pension plans and health benefits -- and stories of exorbitant salaries enjoyed by some public sector workers -- has occurred during a period of slow economic growth, high unemployment, weak tax revenues and rapidly increasing levels of federal debt.  The discussion about how to control spending on the state, local and federal levels has sparked a debate about the role public sector unions have played in the growth of spending over the past several decades.

  • Public sector unions are able to affect governments' fiscal and budgetary policy by exerting influence through the collective bargaining process and through political activity by backing candidates likely to support the union's agenda.
  • Several studies indicate public sector unions are more politically active as a group, with state and local employees more likely to vote than private sector or federal workers.
  • Curbing collective bargaining laws may or may not have the effects intended by reformers if the political activity of unions is a far more powerful influence over spending.
  • Some important questions remain to be explored, including testing the link between collective bargaining and the political activity of unions and their effects on pension funding, pension shortfalls, budget gaps, and overall state and local indebtedness.

Source: Eileen Norcross, "Public-Sector Unionism: A Review," Mercatus Center, May 2011.

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