Economy & Jobs

Understanding Unions: Factors and Criticisms to Consider

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As you enter the workforce, you may notice that some of your colleagues are part of unionized efforts. Membership into a union will enable you to join in collective bargaining with management over issues such as compensation, benefits, job security, training, and vacation. If you are considering joining a union, however, you should know the factors and criticism surrounding them before making a final decision. Understanding unions involves knowing their purpose and history, but also a firm grasp on how they can best serve you as a millennial.

A Brief History of Unions

Laborers have organized for better working conditions since early in American history. According to, some of the oldest recorded American unionized efforts are dated back to a 1768 strike in New York (tailors), and the 1794 creation of the Federal Society of Journeymen Cordwainers in Philadelphia (shoemakers). Throughout the Industrial Revolution, workers advocated for safer factory conditions, regulations aimed to protect children and women in the labor force, and other conditions to improve the welfare of workers.

Over the decades, the labor movement has successfully lobbied for the passage of laws to establish a minimum wage, job access for disabled individuals, overtime pay, and occupational safety standards. But there is still debate on whether unions are remnants of a bygone era, and whether or not organized labor advances modern employment in an age of technology, meritocracy, and market competition.

Factors to Consider

According to 2014 data from the Bureau of Labor Statistics (BLS), some of the industries with the highest unionized rates include teaching, librarians, training, and protective services (all standing at 35.3 percent). The data also showed that public-sector workers had a union membership rate that was five times higher than that of private-sector workers (35.7 percent vs. 6.6 percent).

In certain jobs (particularly those requiring specialized skills and a college degree), nonunion members tend to receive a higher pay. These industries include business services, information technology, finance, and legal. On average, however, union workers enjoy higher pay. Here are some additional key statistics:

  • In 2014, nonunion workers earned 21 percent less than union members, according to data from the U.S. Bureau of Labor Statistics (BLS).
  • A total of 92 percent of union workers have health benefits versus 68 percent of nonunion workers, according to the benefits organization, Union Plus.
  • In 2014, the median weekly income for full-time union members who worked in the private sector was $907, according to BLS. For nonunion workers, it was $753 — a weekly difference of $154.
  • In the public sector, union members earned $1,014 per week while nonunion workers earned $850 — a weekly difference of $164.

With these numbers in hand, you may also want to consider your personal circumstances. Ask yourself if you want to be promoted based on merit or seniority. Do you reside in a right-to-work state where you can voluntarily opt out of membership? You should also consider how much you will be paying in annual dues.

Criticism of Unions

Critics argue that labor unions can make a company less competitive (due to added labor costs). In the context of a global economy, organized labor is becoming less significant because rival companies must compete on price and quality. Market competition also requires individual initiative and the delivery of business results — not seniority and tenure.

Union membership could also make it difficult for management to terminate an underperforming employee, and that may damage morale and productivity of the entire team. Additionally, unreasonable union demands could hurt members when a business simply outsources jobs to foreign countries in search of cost-efficiency.

Joining a union remains a popular option for American workers, especially those in the public sector. Though unions provide an added level of job security in uncertain times, understanding unions is a necessary first step before you fully commit.

Over 6,000 articles appear under Marv Dumon's byline. He has written for Forbes, Harvard Business Review, Yahoo!, and Fortune 500 clients. Marv previously worked in mergers and acquisitions (M&A) and Six Sigma, and earned BA, BBA and MPA degrees from the University of Texas at Austin.