Contraction and Expansion: The Divergence of Private Sector and Public Sector Unionism in the United States

Abstract

The institutional structure of the American labor market changed remarkably from the 1950s and 1960s to the 1980s. What explains the decline in union representation of private wage and salary workers? Why have unions expanded in the public sector while contracting in the private sector? Is the economy-wide fall in density a phenomenon common to developed capitalist economies, or is it unique to the United States? To what extent should economists alter their views about what unions do to the economy in light of the fact that they increasingly do it in the public sector? To answer these questions I examine a wide variety of evidence on the union status of public and private workers. I contrast trends in unionization in the United States with trends in other developed countries, particularly Canada, and use these contrasts and the divergence between unions in the public and private sectors of the United States to evaluate proposed explanations.