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Study: Weakening Unions Increases Gender Gap in Wages

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Barbara Biasi, assistant professor of economics at the Yale School of Management, recently published a study that concluded that eliminating unions increases the gender gap in wages.

She looked at data from Wisconsin, before and after Scott Walker eliminated collective bargaining rights in 2011, in his Koch-funded effort to destroy unions.

For every dollar earned by men in the U.S., women earn about 82 cents, according to 2018 census data; this pay gap is even larger for Black and Hispanic women.  Some public schools have avoided the gender wage gap because they follow a strict salary schedule, in which each teacher’s pay is determined based on objective factors such as seniority and academic degrees. But what happens when schools switch to a more flexible pay system?

Barbara Biasi, an assistant professor of economics at Yale SOM, had an opportunity to examine this question when Wisconsin passed Act 10, legislation that essentially weakened the power of teachers’ unions. Afterward, schools had much more latitude in deciding how much to pay teachers.

Five years after union agreements expired, male teachers earned about 1% more per year than female colleagues with similar experience and skills, reported Biasi and her co-author, Heather Sarsons at the University of Chicago Booth School of Business. The gender gap was even higher among younger teachers.

While 1% might not seem like much, such a gap can substantially affect income in the long run, Biasi says. It “can add up pretty quickly over the course of a person’s career,” she says.

The results suggest that women may start earning less than men when they have to bargain on their own, rather than being supported by a union that negotiates for them. This effect could be seen in many industries as union membership shrinks. “The decline of union power might have an increase in the gender gap in pay as one of the unintended consequences,” Biasi says.

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