Why So Unhappy? The Effects of Unionization on Job Satisfaction*
| Author | Alex Bryson,Lorenzo Cappellari,Claudio Lucifora |
| DOI | http://doi.org/10.1111/j.1468-0084.2010.00587.x |
| Published date | 01 June 2010 |
| Date | 01 June 2010 |
357
©Blackwell Publishing Ltd and the Department of Economics, University of Oxford, 2010. Published by Blackwell Publishing Ltd,
9600 Garsington Road, Oxford OX4 2DQ, UK and 350 Main Street, Malden, MA 02148, USA.
OXFORD BULLETIN OF ECONOMICS AND STATISTICS, 72, 3 (2010) 0305-9049
doi: 10.1111/j.1468-0084.2010.00587.x
Why So Unhappy? The Effects of Unionization on
Job SatisfactionÅ
Alex Bryson†, Lorenzo Cappellari‡ and Claudio Lucifora‡,§
†National Institute of Economic and Social Research, Smith Square, London, UK
(e-mail: a.bryson@niesr.ac.uk)
‡Istituto di Economia dell’Impresa e del Lavoro, Università Cattolica, Largo Gemelli,
1 1-20123, Milano, Italy (e-mail: lorenzo.cappellari@unicatt.it)
§IZA (Bonn) and ERMES (Paris) (e-mail: claudio.lucifora@unicatt.it)
Abstract
Using linked employer–employee data we investigate the job satisfaction effect of
union membership in Britain. We develop a model that simultaneously controls for
the determinants of individual membership status and for the selection of employees
into occupations according to union coverage. Wefind a negative association between
membership and satisfaction. However, having accounted for selection effects, wefind
that the negative association is confined to non-covered employees. This is consistent
with ‘voice’ effects, whereby non-covered members voice dissatisfaction to achieve
union goals, and with the possibility that membership increases preferences for collec-
tive bargaining, thus lowering members’satisfaction in non-covered environments.
I. Introduction
Surveys of employees’ opinions typically reveal that union members’ reported job
satisfaction is lower than non-members’. This empirical regularity has been found in
several data sets, in different countries and different time periods.1This is puzzling as
ÅThe authors thank the Department for Business, Innovation and Skills the Economic and Social Research
Council, theAdvisory, Conciliation and Arbitration Service and the Policy Studies Institute who co-sponsored
the Workplace Employment Relations Surveys, and acknowledge the UK DataArchive as the distributor of
the data. The authors are grateful to two anonymous referees for their helpful comments.
JEL Classification numbers: J28, J51
1The empirical evidence is mostly concentrated in Anglo-Saxon countries. Selected studies reporting nega-
tive effects of membership on job satisfaction are: Freeman and Medoff (1984), Gordon and Denisi (1995) and
Borjas (1979) for the United Status; Guest and Conway (2004), Bender and Sloane (1998) and Bryson et al.
(2004) for the United Kingdom; Meng (1990) and Renaud (2002) for Canada; Miller (1990) for Australia;
Frenkel and Kuruvilla (1999) for South Korea.
358 Bulletin
unions should improve working conditions, this being among the reasons for joining
a union.
Confronted with the negative association between membership and job satis-
faction, previous research has advanced two main alternative interpretations. A
first explanation is based on the ‘sorting’ hypothesis, suggesting that dissatisfaction
is mainly driven by poorer working conditions in unionized environments or by
individual characteristics of unionized workers that are imperfectly controlled for
in the empirical analysis, generating spurious correlation between membership and
satisfaction (Schwochau, 1987; Bender and Sloane, 1998). A second explanation has
focused on the ‘voice’ hypothesis, whereby unions may trigger members’ reported
dissatisfaction by allowing them to express their complaints instead of quitting the
job (e.g. through grievance procedures, as in the ‘exit-voice’ theory of Freeman and
Medoff, 1984), or because they politicize the labour force and strategically foment
discontent to increase bargaining power (Borjas, 1979; Davis-Blake and Pfeffer,1990;
Gordon and Denisi, 1995).
Previous studies have paid little attention to the modelling of the institutional
context for union activity and bargaining practices at the workplace. In particular,
union bargaining coverage at the workplace has been overlooked on the assumption
that only individual membership matters for job satisfaction. This might not be a
problem in countries like the United States where membership and coverage are
virtually synonymous, but it may be important in countries like the United Kingdom
where many workers are covered by some type of collective contract but are not
union members and vice versa. There are reasons to think that adding coverage to
the picture can improve our understanding of the membership satisfaction puzzle.
The need to use voice may differ in covered and non-covered jobs implying different
effects of membership on satisfaction in the two cases. In addition, membership may
be associated with individuals’ preferences for collective bargaining, and members’
dissatisfaction in non-covered occupations may reflect such preferences. However,
the incentives to join the union can differ by coverage, which in turn may affect sorting
into membership. Finally, the sorting of workers into covered and non-covered jobs
may itself be non-random, implying that coverage status, like membership, may be
endogenous. For example, workers might queue for covered jobs when the latter are
rationed (Abowd and Farber, 1983) and failure to obtain a union-covered job may
itself generate dissatisfaction among members if lack of coverage is inconsistent with
their preferences.
This article is the first to consider the interplay between individual union
membership and bargaining coverage in explaining the link between membership
and satisfaction. Weuse linked employer–employee data representative of the British
workforce to analyse job satisfaction while simultaneously addressing employees’
selection into both union membership and covered jobs within workplaces. Weexploit
the linked nature of the data to identify the impact of unionization on satisfaction.
Our results indicate that membership effects on satisfaction depend crucially upon
bargaining coverage. We find no differences in satisfaction between members and
©Blackwell Publishing Ltd and the Department of Economics, University of Oxford 2010
To continue reading
Request your trial