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Aims and objectives. We estimate the impact of unionisation on the wage structure of hospital-employed registered nurses in the
USA. We examine whether unions have an effect on wage differences associated with race, gender, immigration status, education and experience, as well as whether there is less unexplained wage variation among unionised nurses.
Background. In the past decade, there has been resurgence in union activity in the health care industry in the USA, particularly
in hospitals. Numerous studies have found that unions are associated with higher wages. Unions may also affect the structure of
wages paid to workers, by compressing the wage structure and reducing unexplained variation in wages.
Design. Cross-sectional analysis of pooled secondary data from the United States Current Population Survey, 20032006.
Method. Multivariate regression analysis of factors that predict wages, with models derived from labour economics.
Results. There are no wage differences associated with gender, race or immigration status among unionised nurses, but there are
wage penalties for black and immigrant nurses in the non-union sector. For the most part, the pay structures of the union and
non-union sectors do not significantly differ. The wage penalty associated with diploma education for non-union nurses
disappears among unionised nurses. Unionised nurses receive a lower return to experience, although the difference is not
statistically significant. There is no evidence that unexplained variation in wages is lower among unionised nurses.
Conclusions. While in theory unions may rationalise wage-setting and reduce wage dispersion, we found no evidence to support
this hypothesis.
Relevance to clinical practice. The primary effect of hospital unions is to raise wages. Unionisation does not appear to have
other important wage effects among hospital-employed nurses.
Key words: hospitals, industrial relations, nursing, wages
Accepted for publication: 25 November 2009
Introduction
Unions that represent health professionals have become
increasingly important in the employment and political
landscape of the USA. Nearly 21% of registered nurses
(RNs) in the USA were unionised in 2003 (Terlep 2006).
In recent years, nursing unions have claimed credit for
wage increases across the USA, hospital worker safety
improvements, implementation of minimum nurse-toAuthors: Joanne Spetz, PhD, Professor, School of Nursing, University
of California, San Francisco, CA; Michael Ash, PhD, Associate
Professor, Economics and Public Policy, University of Massachusetts,
Amherst, MA; Charalampos Konstantinidis, MA, Doctoral
Candidate, Department of Economics, University of Massachusetts,
Amherst, MA; Carolina Herrera, MA, Statistician, School of
Nursing, University of San Francisco, CA, USA
60
Original article
Background
In the past decade, there has been resurgence in union activity
in the health care industry in the USA, particularly in
hospitals. Of 24 million RNs employed in the USA in 2003,
unions represented about 472,000, or nearly 21% (Terlep
2006). This rate is over five percentage points higher than for
all workers in the USA (Clark & Clark 2006). Membership of
hospital-employed RNs in unions in the USA was stable at
about 18% from 1983 through the mid-1990s, and grew
rapidly since that time (Fig. 1). The apparent volatility in the
rate of unionisation reflects sampling variation; the error
bands are wide enough to make the spiky series consistent
with the smoothed results, which are available from the
authors on request. During the first six months of 2000,
health care unions, including unions for nurses, service
workers and other healthcare employees, won organising
Union density
021
020
019
018
017
016
1985
1990
1995
2000
2005
Year
Figure 1 Per cent of hospital-employed registered nurses who are
union members.
61
J Spetz et al.
Methods
Data
Our source of data on nurses is the merged outgoing rotation
groups of the 2003 through 2006 Current Population Surveys
(CPS), which is collected by the United States Bureau of
Labor Statistics. Union membership data were first collected
on a regular monthly basis beginning with the 1983 CPS.
From the CPS, we extracted all RNs (Census Occupation
Code = 3130) working in hospitals (Census Industrial
Code = 8190) whose incomes were directly reported (and
not imputed). Although the CPS is in principle a longitudinal
dataset, with each participant appearing twice in the outgoing rotation group, we ignore the repeated observations, both
in terms of identification (Hirsch & Macpherson 2000) and
in terms of clustered errors. The CPS sample used for this
analysis, after applying restrictions described later, had 831
RNs who were unionised and 3403 non-union nurses.
Because we pool nurses from multiple years of the CPS,
there is not a straightforward comparison of the sample size
to the national population of RNs, but the unionisation rate
and the share of RNs employed in hospitals is consistent with
other data sources, such as the 2004 National Sample Survey
of Registered Nurses (Health Resources and Services Administration 2006).
The hourly wage for RNs is computed as usual weekly
earnings divided by usual weekly hours. We use the CPI-URS, a time-consistent measure of the US consumer price level,
to convert all values to real 2006 dollars. Educational
attainment was based on credentials received by nurses;
however, we cannot observe whether the completed degree
62
Analysis
To measure the impact of unions on the wage structure of
nurses, we estimate two multivariate ordinary least squares
equations one for unionised nurses and one for non-union
nurses. The dependent variable in these equations is the
natural logarithm of computed hourly wage. The explanatory
variables include human capital and demographic characteristics: education, experience and experience squared, gender,
race/ethnicity, and immigrant status. We also control for the
region of the USA where the nurse lives, which is measured
with a set of dummy variables. There are nine regions, each of
which we subdivide into two sub-regions one for rural
residents and one for urban residents. Thus, we have 18
regions, represented by 17 dummy variables in the equations
(urban northeast is the excluded region). Finally, we include
three dummy variables to control for each year of data, with
2003 as the omitted year.
After estimating the two equations, we first compare the
values of key coefficients between these equations using
t-tests to learn whether there are significant differences in the
effect of selected variables on wages. We focus on how
unionisation status affects pay differences that are widely
observed: gender, racial/ethnic, educational and seniority.
Second, we examine wage variation and residual wage
variation by union status. We compare the R-squared values
of the equations, which measure the amount of variation in
the data explained by the wage equations. We also compare
the distributions of residual wages from the equations, thus
explicitly assessing whether there is greater unexplained
variation between union and non-union RN wages.
Results
Table 1 presents characteristics of union and non-union
RNs employed in hospitals, with data from 20032006
combined. Average hourly earnings are substantially higher
for unionised nurses. Union and non-union RNs are both
Original article
Union
Non-union
$3350
911%
189%
856%
719%
67%
52%
162%
47%
371%
504%
54%
23%
4285
$2820
924%
101%
800%
825%
60%
35%
80%
47%
404%
490%
43%
16%
4117
Table 2 Coefficients from multivariate regression equations for registered nurse (RN) wages, 20032006 (standard errors in parentheses)
Unionised RNs
Female
0030 (0037)
Immigrant
0020 (0048)
Race/ethnicity (non-hispanic white omitted)
Black
0035 (0069)
Hispanic
0108* (0058)
Other
0024 (0046)
Education (Associates degree omitted)
Diploma
0075 (0060)
Bachelor
0083** (0027)
Masters
0237** (0053)
Doctorate
0063 (0087)
Potential experience
0017** (0005)
Potential experience squared
00003** (00001)
R-squared
027
n
832
Non-union RNs
Difference (unionnon-union)
0005 (0024)
0064** (0030)
0026 (0044)
0084 (0057)
0068** (0032)
0042 (0042)
0043 (0034)
0033 (0076)
0066 (0071)
0019 (0058)
0053* (0028)
0074** (0012)
0197** (0033)
0045 (0047)
0019** (0002)
00003** (000004)
019
3404
0129** (0066)
0008 (0029)
0040 (0063)
0018 (0099)
0002 (0005)
000002 (00001)
Dummy variables are included to control for year and for region.
*Significant at 010.
**Significant at 005.
63
J Spetz et al.
Ageexperience profile, by union status
025
Non-union
020
1500
015
Union
1000
Frequency
Wage increase
010
500
005
000
10
15
20
25
30
35
15
Experience
05
00
05
10
15
300
200
Frequency
64
10
100
15
10
05
00
05
10
15
Discussion
This analysis provides mixed evidence regarding whether
unions have an effect on the wage structure of RNs. We find
little evidence that there are differences in wages associated
with gender, immigrant status, race/ethnicity, education or
experience. Although wage equations indicate that immigrant
and black non-union RNs face a wage penalty, while unionised
Original article
Conclusion
Wage differentials can reflect rewards provided to nurses
with greater skill and knowledge; however, they also might
be associated with discrimination and monopsonistic wagesetting practices. In addition to striving to raise wages,
hospital unions also might seek to change the variation in
wages. We find weak evidence that unions reduce wage
differences associated with race and immigration status and
some additional evidence that wages are more closely
associated with the collective set of observable factors among
unionised nurses. We also find some indication that the wages
of unionised nurses rise more slowly with experience than do
the wages of non-union nurses.
65
J Spetz et al.
Acknowledgements
The authors acknowledgement support from Grant-in-aid for
Scientific Research (B: principal investigator Yoshifumi
Nakata) by The Japan Society of Promotion of Science and
Grant for International Collaborative Research (principal
investigator Yoshifumi Nakata) by Pfizer Health Research
Foundation. The authors thank Jean Ann Seago and Jennifer
Kaiser for their support and comments in the process of
writing this paper.
Contributions
Study design: JS, MA, data collection and analysis: MA, CK,
JS and manuscript preparation: JS, MA, CH.
Conflict of interest
The authors have no competing interests associated with this
manuscript.
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