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JOB QUEUES AND THE UNION STATUS
OF WORKERS
Industrialand Labor Relations Review, Vol. 35, No. 3 (April 1982). ? 1982 by Cornell University.
0019-7939/82/3503-0354$01 .00
354
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JOB QUEUES AND UNION STATUS 355
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356 INDUSTRIAL AND LABOR RELATIONS REVIEW
(5) yli= nwu, - Inwni - Oi. and nonpecuniary costs and benefitsof
Individual i will prefera union job if y i union membershipnet of any wage differ-
> 0 and a nonunion job ifYIi < ? 5 ential. The obvious elementsof thecostsof
Assume that each individual has union union membershipare dues paymentsand
and nonunion earnings functionsof the initiation fees. The pecuniary benefitsof
form unionization other than higher wages ac-
crueas higherlevelsoffringebenefits,such
(6) Inwuz = XU7
Mu+ Fuiand as insurance and pension plans, in union
(7) nwni = XniI0n + Enz jobs relativeto nonunion jobs. While data
where xui and xniare row vectorsof indi- concerning relative provision of fringe
vidual and labor market characteristics benefits forindividuals in union and non-
pertainingto individuali and Euland Eni union jobs arerare,theU.S. Bureau ofLabor
representrandom errors.The parameter Statistics reports thatin 1972 "pay fortime
vectors f8uand f3n are assumed to be con- workedas a percentof total compensation
stant across individuals and to be given was about 6 percentagepoints lower for
exogenously.6 union than for nonunion workersin all
The union-nonunion wage differential situations."7Thus, evenifunions conferno
facingany workeris wage advantageon theirmembers,on aver-
age union members receive more fringe
(8) AzSnwi= Anwui- nW
benefits.8
-
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JOB QUEUES AND UNION STATUS 357
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358 INDUSTRIAL AND LABOR RELATIONS REVIEW
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JOB QUEUES AND UNION STATUS 359
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360 INDUSTRIAL AND LABOR RELATIONS REVIEW
for the IQ and CFQ equations contain abilityof being chosen fromthe queue.
largelythesamevariables,thereare twovar- Implicit in thisdiscussionis thefactthat
iables thataffecttheIQ decision but not the theanalysis is developedconditionalon the
CFQ decision. Thus, by Poirier's criterion worker's union status in the last period.
the model is identified. Simply put, the hypothesisformulatedin
The variables thatare included in xl but the last paragraph statesthatworkerswho
not in x2are measuresof seniority.Senior- held a union job last yearare morelikelyto
ity is an important determinantof both desire a union job this year, and workers
the wage and nonwage benefitsa worker who held a nonunion job last yearare less
receivesfromthejob. How a worker'ssen- likelyto desirea union job thisyear.In addi-
iorityaffectsthe decision regardingunion tion,themagnitudeoftheeffect oflastyear's
employmentdepends on whetherany ac- union status is directlyrelated to the sen-
crued seniorityis relatedto a union job or a ioritytheworkerhas.2'
nonunion job. A worker employed on a The fact that the analysis is conditional
union job has what is called union seniority on last period'sjob statushas an important
(USEN). The union workerwould have to implication,which providesa morefunda-
give up this seniorityto take a nonunion mental kind of identificationthan is pro-
job; thus USEN will have a positiveeffect videdbythefactthatsenioritydoes notaffect
on theprobabilitythattheworkerdesiresa Pr[CFQ=l1IQi=l]. Note thata workerwho
union job. In contrast,a workeron a non- is observedto hold thesame union job both
union job has what is called nonunion sen- last yearand thisyeardid not have to be se-
iority (NUSEN). The nonunion worker lectedfromthequeue thisyear.The worker
would have to giveup thisseniorityto takea held job rightsto that union job, and de-
union job; thus NUSEN will have a nega- siring the union job (IQI=1) is a sufficient
tiveeffecton theprobabilitythattheworker condition for finding him or her in the
desiresa union job.20Clearly,being selected union job. Alternatively, if theworkervol-
fromthe queue entails changing jobs; sen- untarilyleaves a union job to take a non-
iority should have no effecton the prob- union job, it can be inferredthat the indi-
vidual did not want a union job, without
referenceto selectionfromthe queue.
The data are discussed in the next section. (For a dis- A workerwho has job rightstoa union job
cussion of technicaldetails,see Dale J. Poirier, "Par-
tial Observabilityin Bivariate Probit Models," Jour- does not have to join the queue.22 In the
nal of Econometrics,Vol. 12, No. 2 (February1980), contextof the model,Pr[CFQi=l I IQi=l &
pp. 209 -18.) JRi=1] = 1 whereJRtis a dichotomousvari-
20A referee correctlynoted thatmostworkerswould able thatequals one if individual i has job
be required to give up theirunion seniorityif they
rightsto a union job and zero otherwise.
took a job coveredby a different union. We have de-
liberatelychosen not to model multipleunion queues Thus, fromEquations 13, 16, and 17
since this appears to be econometricallyuntractable (18) Pr[Ui=llJRi=l]
and is not in thespiritoftheotherunionizationmodels
we are extending(Lee, "Unionism and Wage Rates," = Pr[IQj=l]Pr[CFQj=lIIQj=l & JRI=l]
and Schmidt and Strauss,"The Effectof Unions on = Pr[IQj=l]
Earnings and Earnings on Unions," for example).
Nevertheless,the union-specificjob-tenure variable =Pr[ 1i, > - x1i1i]d.
certainlycaptures the essential notion that workers
coveredbya collectivebargainingagreementnegotiate
Thus, for individuals with job rightsthe
a compensationpackage tiedto seniorityin ways that union-statusdecision is modeledas a simple
are not transportableto the nonunion sector.Non- univariate probit under the assumption
union workersmay also receivecompensation pack-
ages tied to seniorityin waysthatare not transportable
to other employers(see Edward P. Lazear, "Why is 2lA workerfiredfromor voluntarilyleaving thejob
There Mandatory Retirement?"Journal of Political sen-
he or she held last yeardoes not have any effective
Economy,Vol. 87, No. 6 (December 1979),pp. 1261- iority.Hence, both USEN and NUSEN would be zero
84). Enforceability ofcollectivebargainingagreements forsuch an individual.
allows substantialdifferences in the methodsused by 22A workerwho is firedfromtheunion job held last
union and nonunion employersin tying compen yearalso does not have anyjob rightsand mustjoin the
sation to seniority. queue like any otherworkerwithoutjob rights.
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JOB QUEUES AND UNION STATUS 361
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362 INDUSTRIAL AND LABOR RELATIONS REVIEW
Standard
Variable Definition Mean Deviation
N = 1341
a Taken over thesubsample of408 workerswho had positive USEN. These 408 workerswerenot firedor laid off
fromthe union job theyheld in 1975.
bTaken overthesubsampleof 826 workerswho had positiveNUSEN. These 826 workerswerenot firedor laid off
fromthe nonunion jobs theyheld in 1975.
c See textfordefinitionof job rights.
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JOB QUEUES AND UNION STATUS 363
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364 INDUSTRIAL AND LABOR RELATIONS REVIEW
minant of union status in spite of theevi- Union and nonunion seniorityhave the
dencecitedabove thatthewage advantageof hypothesizedeffectson the probabilityof
unionization is inverselyrelated to labor desiring a union job. Union seniorityis
marketexperience. positivelyrelatedtoPr[IQ=1], and nonunion
The last two columns of Table 2 contain seniorityis negativelyrelatedto Pr[IQ=1].
the maximum-likelihoodestimatesof the A resultthatis contrarytoour expectation
parametersof thequeuing model definedin is thatnonwhitesare not morelikelyto de-
Equations 17 and 18. The maximum log- sire a union job. The lower white-black
likelihoodvalue is - 305.5,whichcompares wage differentialgenerally found in the
to a log-likelihoodvalue of -331.9 in the union sectorsuggestedthatblackswould be
no-queue versionof the model. The likeli- more likely than whites to desire a union
hood ratio teststatisticof52.8(not shownin job.32 In addition, Farber and Saks have
to rejecttheno-queue
thetable) is sufficient found that nonwhiteswere more likely to
model at reasonable levelsofsignificance.30 vote for union representationin National
The resultsare generallyconsistentwith Labor Relations Board supervised repre-
the hypothesesderivedpreviously.For the sentation elections, even aftercontrolling
in-queue relationship, individuals with for the wage effect.33 The nonwhite co-
fewerthantwelveyearsofeducationare sig- efficient in our queue equation is essentially
nificantlymore likely,at the one percent zero.This is consistentwithnonwage bene-
level of significance,to desire a union job fitsof unions accruingprimarilyto whites.
than workers with exactly twelve years' The effectwould cancel the wage benefit
education. Individuals with more than effectmodeled above.
twelveyearsof education are less likelyto A final result is that southernworkers
desire a union job than individuals with are less likelytodesirea union job thannon-
exactly twelve years' education, although southerners.It is possible to rejectthe hy-
this estimatedeffecthas a relativelylarge pothesisthatthecoefficient on southequals
standarderror. zero against the alternativethatthe coeffi-
The estimatesof the queue model imply cientis less thanzeroat thefivepercentlevel
that additional labor-forceexperiencesig- of significance.
nificantlyreduces the probabilityof desir- Now consider the resultsof the chosen-
ing a union job. Holding union and non- from-queueequation (CFQ) reportedin the
union seniorityconstantat zero, the mar- last column ofTable 2. Given thedefinition
ginal impact of an additional yearof labor- of thejob-rightsvariable,theCFQ function
forceexperienceon theprobabilityofbeing mayj ustbe measuringtheeffect oftheprevi-
in theunion queue is negativeover therel- ous year'sunion statuson thecurrentyear's
evant working life of the individual. The union status,and it is trivialto say simply
marginal effectof experienceis dampened that nonunion workerslast year are less
as experienceincreases.On theotherhand, likely to be union workersthis year.Any
thereis no statisticallysignificanteffectof explanatorypowermustcomefromthevari-
experienceon union statusin theno-queue ables included in the CFQ function.As a
model. In addition,theprobabilityofbeing firsttest,the hypothesisthatall the coeffi-
in thequeue is moresensitiveto changesin cientsin the CFQ functionexceptthecon-
experience,absolutely, than is the proba- stantare zero can be rejectedat the .05 level
bility of being in a union job in the no- of significanceusing the usual likelihood-
queue model.3' ratio test.34This suggeststhat the charac-
30The no-queue model embodies seven constraints 32SeeAshenfelter, "Racial Discriminationand Trade
on thequeuing model. These are describedin footnote Unionism."
28. The criticalvalue of a X2 distributionwith seven 33HenryS. Farberand Daniel H. Saks, "Why Work-
degreesof freedomat the .005 level of significanceis ersWant Unions: The Role ofRelativeWages and Job
20.3. Characteristics,"Journal of Political Economy, Vol.
31These claims are supported statisticallyin the 88, No. 2 (April 1980), pp. 349- 69.
appendix, which is available fromthe authors. 34The log-likelihood of the constrained model is
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JOB QUEUES AND UNION STATUS 365
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366 INDUSTRIAL AND LABOR RELATIONS REVIEW
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JOB QUEUES AND UNION STATUS 367
Nonunion
Seniority
(in years) 0 5 10 15 20
ates would prefera union job when they ence) is negativelyrelatedto theprobability
enter the labor force,it becomes the em- of desiringa union job and positivelyre-
ployer'sdecisionas to who will makeup the lated to theprobabilityofbeingchosenfrom
union labor forcein the long run. the queue, as was hypothesized.These re-
sults suggestthata simple probitmodel for
union statusmay be misspecifiedbecause it
Summaryand Conclusions is not based on any consistentbehavioral
A modelofthedetermination oftheunion theory.Such a probitwas shown to hide a
statusofindividualworkersthatallowed for numberof interestingrelationshipsand, to
the possibilityof queuing for union jobs the extentit does so, it is misleading.
was developed. It was hypothesizedthat Finally, it was shown thatthemodel has
moreskilledworkerswould be less likelyto implicationsfortheallocationofworkersto
desirea union job while union employers theunion and nonunion sectors.The results
would be more likelyto want to hiremore suggestthatmostnew entrantspreferunion
skilled workers. jobs but cannot get them.As timegoes by
Overall, the empirical results provide and workers accrue nonunion seniority,
evidencethatis generallysupportiveof the theybecome less likelyto want union jobs.
queuing hypothesis.The no-queue model Thus, the union statusof most workersis
can be rejected,using a likelihood-ratio determinedby theirsuccessin beingselected
test,and theprimaryskill measure(experi- fromthe queue earlyin theirworkinglife.
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