Is There a Union Wage Premium in Germany and Which Workers Benefit Most?

Bonaccolto-Töpfer, Marina; Schnabel, Claus

doi:10.3390/economies11020050

Cited by 4 publications

(2 citation statements)

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“…As a consequence of these institutional features, and in contrast, for example, to the USA, individual membership and being covered by a collective bargaining agreement are only weakly correlated in Germany. Furthermore, there is no clear evidence of a union membership wage premium in Germany when accounting for observable characteristics (see, for example, Schmidt and Zimmermann 1991;Fitzenberger et al 1999;Goerke and Pannenberg 2004;Bonaccolto-Töpfer and Schnabel 2023). Instead, union members appear to benefit in other ways from their membership; they are, for example, less likely to be dismissed individually, and more likely to obtain severance pay, that is, they are more expensive to dismiss Pannenberg 2004, 2010).…”

Section: Institutional Settingmentioning

confidence: 99%

Seeking shelter in times of crisis? unemployment, perceived job insecurity and trade union membership

Chadi

Goerke

2023

Economica

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Do trade unions benefit from economic crises by attracting new members among workers concerned about job security? To address this question, we provide a comprehensive empirical investigation based on panel data from Germany, where workers decide individually on their membership. We analyse whether exogenously manipulated perceptions of job insecurity encourage individuals to join a trade union. Firm‐level workforce reductions serve as the first trigger of perceived job insecurity. Regional unemployment rates represent a second source of exogenous variation. Third, we propose a novel identification approach based on plant‐closure‐induced job losses of other workers in the same region. In each case, we exploit the longitudinal nature of the data to analyse the implications of changes in labour market conditions for changes in union membership using an instrumental variable approach. We find consistently that perceived job insecurity, as triggered by labour market turmoil, increases the likelihood of individual union membership. Analysing data on media coverage about downsizing in a complementary investigation, we add further evidence to the notion of trade unions as beneficiaries of labour market crises. Finally, we consider workers who lose their jobs and find no evidence of adverse effects on union membership among those affected directly by unemployment.

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Section: Institutional Settingmentioning

confidence: 99%

Seeking shelter in times of crisis? unemployment, perceived job insecurity and trade union membership

Chadi

Goerke

2023

Economica

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“…Schmidt and Zimmermann 1991, Fitzenberger at al. 1999, Goerke and Pannenberg 2004, Bonaccolto-Töpfer and Schnabel 2023. Instead, union members appear to benefit in other ways from their membership; they are, for example, less likely to be dismissed individually and more likely to obtain severance pay, i.e., they are more expensive to dismiss (Goerke andPannenberg 2004, 2010).…”

Section: Institutional Settingmentioning

confidence: 99%