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Vulnerable Seniors: Unions, Tenure, and Wages Following Permanent Job Loss

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Author Info
Kuhn, Peter
Sweetman, Arthur

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Abstract

In contrast to nonunion workers, reemployment wages of workers displaced from unionized jobs decline with tenure on the lost job. This finding cannot easily be explained by firm- or industry-specific human capital accumulation, deferred-pay policies, standard matching models, or a correlation between tenure and reentry rates into unionized jobs. Possible explanations include negative selection of senior union workers and a negative causal effect of unionism on workers' alternative skills. Despite a much flatter predisplacement tenure-wage profile, displaced union workers' wage losses increase with tenure at a rate comparable to or higher than those of nonunion workers. Copyright 1999 by University of Chicago Press.

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Publisher Info
Article provided by University of Chicago Press in its journal Journal of Labor Economics.

Volume (Year): 17 (1999)
Issue (Month): 4 (October)
Pages: 671-93
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Handle: RePEc:ucp:jlabec:v:17:y:1999:i:4:p:671-93

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References listed on IDEAS
Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.:
  1. Ruhm, Christopher J, 1990. "Do Earnings Increase with Job Seniority?," The Review of Economics and Statistics, MIT Press, vol. 72(1), pages 143-47, February. [Downloadable!] (restricted)
  2. MaCurdy, Thomas E & Pencavel, John H, 1986. "Testing between Competing Models of Wage and Employment Determination in Unionized Markets," Journal of Political Economy, University of Chicago Press, vol. 94(3), pages S3-S39, June. [Downloadable!] (restricted)
  3. Kuhn, Peter, 1988. "A Nonuniform Pricing Model of Union Wages and Employment," Journal of Political Economy, University of Chicago Press, vol. 96(3), pages 473-508, June. [Downloadable!] (restricted)
  4. Brown, James N & Ashenfelter, Orley, 1986. "Testing the Efficiency of Employment Contracts," Journal of Political Economy, University of Chicago Press, vol. 94(3), pages S40-S87, June. [Downloadable!] (restricted)
    Other versions:
  5. Pearce, James E, 1990. "Tenure, Unions, and the Relationship between Employer Size and Wages," Journal of Labor Economics, University of Chicago Press, vol. 8(2), pages 251-69, April. [Downloadable!] (restricted)
  6. Addison, John T & Portugal, Pedro, 1989. "Job Displacement, Relative Wage Changes, and Duration of Unemployment," Journal of Labor Economics, University of Chicago Press, vol. 7(3), pages 281-302, July. [Downloadable!] (restricted)
  7. Richard B. Freeman, 1982. "Union wage practices and wage dispersion within establishments," Industrial and Labor Relations Review, ILR Review, ILR School, Cornell University, vol. 36(1), pages 3-21, October.
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  8. Katharine G. Abraham & Henry S. Farber, 1987. "Job Duration, Seniority, and Earnings," NBER Working Papers 1819, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  9. Neal, Derek, 1995. "Industry-Specific Human Capital: Evidence from Displaced Workers," Journal of Labor Economics, University of Chicago Press, vol. 13(4), pages 653-77, October. [Downloadable!] (restricted)
  10. Green, D.A., 1991. "A Comparison of Estimation Approach for the Union-Nonunion Wage Differential," UBC Departmental Archives 91-13, UBC Department of Economics.
  11. Jones, Stephen R G & Kuhn, Peter, 1995. "Mandatory Notice and Unemployment," Journal of Labor Economics, University of Chicago Press, vol. 13(4), pages 599-622, October. [Downloadable!] (restricted)
  12. Crossley, T.F., 1998. "What Can We Learn from Displaced Worker Data about the Returns to Tenure?," Papers 346, Australian National University - Department of Economics.
  13. Kuhn, Peter & Robert, Jacques, 1989. "Seniority and Distribution in a Two-Worker Trade Union," The Quarterly Journal of Economics, MIT Press, vol. 104(3), pages 485-505, August. [Downloadable!] (restricted)
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  14. Joseph G. Altonji & Nicolas Williams, 1997. "Do Wages Rise with Job Seniority? A Reassessment," NBER Working Papers 6010, National Bureau of Economic Research, Inc. [Downloadable!] (restricted)
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  15. Doiron, D.J. & Rddell, W.C., 1992. "The Impact of Unionization on Male-Female Earnings Differences in Canada," UBC Departmental Archives 92-30, UBC Department of Economics.
  16. Daniel Parent, 1995. "Industry-Specific Capital and the Wage Profile: Evidence from the NLSY and the PSID," Working Papers 729, Princeton University, Department of Economics, Industrial Relations Section.. [Downloadable!]
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  17. Card, David, 1996. "The Effect of Unions on the Structure of Wages: A Longitudinal Analysis," Econometrica, Econometric Society, vol. 64(4), pages 957-79, July. [Downloadable!] (restricted)
  18. Farber, Henry S, 1983. "The Determination of the Union Status of Workers," Econometrica, Econometric Society, vol. 51(5), pages 1417-37, September. [Downloadable!] (restricted)
  19. Altonji, Joseph G & Shakotko, Robert A, 1987. "Do Wages Rise with Job Seniority?," Review of Economic Studies, Blackwell Publishing, vol. 54(3), pages 437-59, July. [Downloadable!] (restricted)
    Other versions:
  20. Freeman, Richard B, 1980. "The Exit-Voice Tradeoff in the Labor Market: Unionism, Job Tenure, Quits, and Separations," The Quarterly Journal of Economics, MIT Press, vol. 94(4), pages 643-73, June. [Downloadable!] (restricted)
  21. Lemieux, Thomas, 1998. "Estimating the Effects of Unions on Wage Inequality in a Panel Data Model with Comparative Advantage and Nonrandom Selection," Journal of Labor Economics, University of Chicago Press, vol. 16(2), pages 261-91, April. [Downloadable!] (restricted)
  22. Kletzer, Lori Gladstein, 1989. "Returns to Seniority after Permanent Job Loss," American Economic Review, American Economic Association, vol. 79(3), pages 536-43, June. [Downloadable!] (restricted)
  23. Topel, Robert H, 1991. "Specific Capital, Mobility, and Wages: Wages Rise with Job Seniority," Journal of Political Economy, University of Chicago Press, vol. 99(1), pages 145-76, February. [Downloadable!] (restricted)
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  24. repec:fth:prinin:350 is not listed on IDEAS
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Cited by:
(explanations, Please report citation or reference errors to , or , if you are the registered author of the cited work, log in to your RePEc Author Service profile, click on "citations" and make appropriate adjustments.)

  1. David Green & Thomas Lemieux, 2007. "The impact of unionization on the incidence of and sources of payment for training in Canada," Empirical Economics, Springer, vol. 32(2), pages 465-489, May. [Downloadable!] (restricted)
  2. Haan, Peter & Myck, Michal, 2009. "Dynamics of Poor Health and Non-Employment," IZA Discussion Papers 4154, Institute for the Study of Labor (IZA). [Downloadable!]
  3. Mário Centeno & Márcio Corrêa, 2005. "Job Matching, Technological Progress And Worker-Provided On-The-Job Training," Anais do XXXIII Encontro Nacional de Economia [Proceedings of the 33th Brazilian Economics Meeting] 171, ANPEC - Associação Nacional dos Centros de Pósgraduação em Economia [Brazilian Association of Graduate Programs in Economics]. [Downloadable!]
  4. Peter Haan & Michal Myck, 2009. "Dynamics of Poor Health and Non-Employment," SOEPpapers 195, DIW Berlin, The German Socio-Economic Panel (SOEP). [Downloadable!]
  5. Christopher J. O'Leary & Randall W. Eberts, 2007. "Reemployment and Earnings Recovery among Older Unemployment Insurance Claimants," Staff Working Papers 07-133, W.E. Upjohn Institute for Employment Research. [Downloadable!] (restricted)
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