The Effects of Benefits and Union

Membership on Total Salary in San

Francisco
By Michaela Morales, David
O’Reilly, and Mariëlla van der
Sluijs
Introduction
● Two types of non-wage forms of compensation
○ Monetary and non-monetary
● Many people rely on employers for benefits
● Average employee costs $36.22/hour
○ $24.72/hour in salary and $11.50/hour in benefits
● Union workers tend to earn higher wages and benefits than
non-union workers
 1. Which benefits are
statistically significant
factors in determining total

Research Questions
salary?
2. Is being in a union a
statistically significant
Data from the San Francisco
factor in determining total
Controller’s Office
salary?
Methods
Response variable: Methods for both Research
Questions:
● Total Salary
1. Basic Data Exploration
Explanatory variables: a. Find simple relationships
b. Gain better understanding of data
● Retirement 2. Full linear model
● Health/Dental a. Back-forward method
b. Find reduced model
● Other Benefits
3. ANOVA nested F-test
● Union
a. Compare reduced to full model
● Year
Simple Effects
Simple Effect of Health/Dental on Total Salary Simple Effect of Retirement on Total Salary

𝛽 = -938.66 + 8.05(Health.Dental) 𝛽 = 7.648e+03 + 5.1(Retirement)

 Boxplot of Total Salary ~ Union
We can see that there is clear difference in Total Salary across unions.
Full and Reduced Model
Full model: Reduced Model:

● All benefits are significant (p < ● Remove union

.05) ● All benefits are still significant
● Some unions are not significant (p < .05)
(p > .05) ● Adjusted R-squared value .8667
● Adjusted R-squared value .9122
 Ho: All βs = 0
Hа: At least 1 β ≠ 0

2.2e-16 The p-value is significant, so we

reject the null hypothesis.
P-value of ANOVA nested F-test
Union is a significant factor, so
the full model is better.
Discussion
Results: Future Research:

● All the benefits are significant ● Look at other factors that could
○ Makes sense: salary and benefits determine one’s salary
tend to be related ○ Years of experience
● Union is a significant factor in ○ Degree
determining Total Salary
○ Makes sense: union workers tend to
earn higher wages and benefits than
non-union workers
Questions?
References
Budd, John. The Effect on Unions of Employee Benefits and Non-Wage
Compensation: Monopoly Power, Collective Voice, and Facilitation. University of
Minnesota, 2005.

Employer Costs for Employee Compensation - June 2018. Bureau of Labor

Statistics, 2018.

Long, George. Differences between union and nonunion compensation, 2001-2011.

Bureau of Labor Statistics, 2013.