With Inflation High, Unions Suppress Wages

Good luck with the raise if you’re in a union right now. That’s the unspoken message of a July 29 report by the Federal Bureau of Labor Statistics. It showed that nominal wages for non-union workers rose 5.8% yoy in June, compared to just 3.8% for unionized workers. The gap has been widening for a year.

Why? Inflation. This divergence makes sense given how union contracts work. Unions negotiate long-term collective agreements between workers and employers, with a typical contract lasting three to five years. This secures the union’s profits, but leaves it little bargaining power or flexibility if something sudden or severe, like the current inflation, strikes. So as long as the contract doesn’t expire, union members are trapped when they need the freedom to negotiate better pay rises much more quickly.

https://www.wsj.com/articles/with-inflation-high-unions-suppress-wages-collective-bargaining-contracts-starbucks-delta-nonunionized-workers-labor-law-negotiations-11659888541 With Inflation High, Unions Suppress Wages

Alley Einstein

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