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Deunionization and skills

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  • Pickens, Joseph

Abstract

A search and matching model is developed to investigate the effect of skill distribution change and skill-biased technical change (SBTC) on United States private sector unionization. The model’s equilibrium is such that workers with moderate skill will select into the union sector while those with low or high skill will select into the non-union sector. The model’s calibration to the U.S. private sector employs a novel method to separate movements in the skill distribution and skill premium. This, in turn, is used to help identify SBTC. A counterfactual analysis documents a significant relationship between the skill distribution and unionization. In particular, a rise in skill dispersion accounts for one-seventh of U.S. private sector deunionization between 1984 and 2019. This analysis also gives a quantitative effect of SBTC in line with the literature: it accounts for between one-fifth and two-fifths of deunionization depending on the specification. However, part of its qualitative effect is novel: SBTC shifts unionization towards more skilled workers. Further analysis suggests that skill distribution change is not likely to have a significant effect on private sector unionization in the future.

Suggested Citation

  • Pickens, Joseph, 2025. "Deunionization and skills," Labour Economics, Elsevier, vol. 94(C).
    • Handle: RePEc:eee:labeco:v:94:y:2025:i:c:s0927537125000387
    DOI: 10.1016/j.labeco.2025.102711
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    Keywords

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    JEL classification:

    • J50 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - General
    • J24 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Human Capital; Skills; Occupational Choice; Labor Productivity
    • O33 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Technological Change: Choices and Consequences; Diffusion Processes

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