Labor Market Tightness and Union Activity

We study how labor market conditions affect unionization decisions. Tight labor markets might spur unionization, e.g., by reducing the threat of unemployment after management opposition or employer retaliation in response to a unionization attempt. Tightness might also weaken unionization by providing attractive outside alternatives to engaging in costly unionization. Drawing on a large-scale, representative survey experiment among U.S. workers, we show that an increase in worker beliefs about labor market tightness moderately raises support for union activity. Effect sizes are small as they imply that moving from trough to peak of the business cycle increases workers’ probability of voting for a union by one percentage point. To study equilibrium effects, we draw on three quasi-experimental research designs using data from across U.S. states and counties over several decades. We find no systematic effect of changes in aggregate labor market tightness on union membership, union elections, and strikes. Overall, our results challenge the notion that labor market tightness significantly drives U.S. unionization.