FIGURE 14.11 Percentage of Wage and Salary Workers Who Are Union Members The share of wage and salary

workers who belong to unions rose sharply in the 1930s and 1940s, but has tailed off since then to 10.3% of all

workers in 2021.

The following section analyzes the higher pay union workers receive compared the pay rates for nonunion

workers. The section after that analyzes declining union membership levels. An overview of these two issues

will allow us to discuss many aspects of how unions work.

Higher Wages for Union Workers

How does a union affect wages and employment? Because a union is the sole supplier of labor, it can act like a

monopoly and ask for whatever wage rate it can obtain for its workers. If employers need workers, they have to

meet the union’s wage demand.

What are the limits on how much higher pay union workers can receive? To analyze these questions, let’s
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