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Unions as Insurance: Employer–Worker Risk Sharing and Workers' Outcomes during COVID-19

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  • Braakmann, Nils

    (Newcastle University)

  • Hirsch, Boris

    (Leuphana University Lüneburg)

Abstract

We investigate to what extent workplace unionisation protects workers from external shocks as predicted by models of implicit contracts. Using the COVID-19 pandemic as a plausibly exogenous shock hitting the whole economy, we compare workers who worked in unionised and non-unionised workplaces directly before the pandemic in a difference-in-differences framework. We find that unionised workers were substantially more like to remain working for their pre-COVID employer, at their pre-COVID workplace, in their pre-COVID job and to be in employment. This greater employment stability was not traded off against lower working hours or labour income.

Suggested Citation

  • Braakmann, Nils & Hirsch, Boris, 2023. "Unions as Insurance: Employer–Worker Risk Sharing and Workers' Outcomes during COVID-19," IZA Discussion Papers 15893, Institute of Labor Economics (IZA).
    • Handle: RePEc:iza:izadps:dp15893
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    References listed on IDEAS

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    More about this item

    Keywords

    unions; risk-sharing; implicit contracts; insurance effects; COVID-19;
    All these keywords.

    JEL classification:

    • J51 - Labor and Demographic Economics - - Labor-Management Relations, Trade Unions, and Collective Bargaining - - - Trade Unions: Objectives, Structure, and Effects
    • I18 - Health, Education, and Welfare - - Health - - - Government Policy; Regulation; Public Health
    • I19 - Health, Education, and Welfare - - Health - - - Other
    • J63 - Labor and Demographic Economics - - Mobility, Unemployment, Vacancies, and Immigrant Workers - - - Turnover; Vacancies; Layoffs

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