The Positive Affects Unions Have on the Economy

The Positive Affects Unions Have on the Economy

Labor unions have existed since the 1700s, with their origins dating as far back as the Industrial Revolution. Since that time, unions have come a long way and drastically changed the interactions and expectations between employers and workers. In addition, workplace regulations have been greatly influenced by union efforts.

Increased Worker Wages

Unions use “collective bargaining” to increase worker wages. Unions attach a salary to a job and not to a particular employee, and then use their collective power to negotiate fair and equitable wages. This benefits the entire employee group and reduces favoritism for individuals.

Unions also use their collective bargaining power to secure non-wage benefits, such as paid time off, health insurance and retirement, and improved working conditions. Union members also have a defined way to settle their grievances and an advocate to represent their interests in the disciplinary process. This contributes to higher employee morale and lower turnover rates.

It is not hard to see a direct effect of union advocacy and America’s improved middle class. Unions “pull millions of non-union Americans into the middle class by setting higher compensation standards that push everyone’s wages up.” ( Without the negotiating success of unions and collective bargaining, the economic benefits to low- and middle-income workers would decline substantially. Household consumption accounts for about 70% of our gross domestic product, so if the majority of the country cannot afford to spend, the economy stalls.

Equality For Underrepresented Populations

Higher wages for a community as a whole reduce income inequality among populations. Through their advocacy, unions protect and reduce wage gaps between genders and racial/ethnic groups. For example, they ensure that underrepresented groups such as people with disabilities are not taken advantage of or unfairly dismissed. And, studies have shown that union membership reduces racial resentment.

According to, “Rigorous research shows that unions reduce gender wage gaps within given employers”. Almost two-thirds of covered workers are women, where hourly wages are 5.8% higher than women in non-union jobs. And the use of collective bargaining also increases the wages of people of color closer to their Caucasian counterparts, thus narrowing the wage gap between ethnic groups.

Broader Community and Economic Benefits

Unions go beyond wages, benefits, and safety concerns for their workers. Unions empower workers to advocate for themselves within the workplace, in their communities, and in the political sphere as well.

Studies have shown that communities without adequate union representation usually have:

  • Lower voter turnout
  • Lower organized labor contributions
  • Less voter mobilization
  • Fewer serving working-class candidates
  • And more conservative state policies

Unions provide workers with the power to speak up for what they need in the workplace. With a happier and more well-rounded workforce, productivity increases and employee turnover rates decrease.

Union-negotiated contracts are a collective agreement between the employer and the union, and both sides strive for increased productivity and overall benefits. In addition to higher wages, unionized businesses tend to invest in more or newer equipment and employee training. Competitiveness increases within different fields, and the quality of goods and services also increases. Healthy competition within industries keeps the market fair for all. It’s better for all parties when there is an active, happy workforce—and the economy benefits overall when unions are strong.

Additional Community Benefits of APC

APC represents Unit 4 employees within the CSU system who serve an important role supporting the academic needs of CSU students. Specifically, they promote higher education in communities all over the state, recruit students to attend CSU, and assist them in achieving their educational goals. The support of its members allows APC to negotiate and advocate for fair and equitable wages, improved working conditions, and fair representation for all Unit 4 employees.

If you would like more information on the benefits of joining APC, please contact the local Steward at your campus.