Unions and Traditionally Disadvantaged Workers: Evidence from Union Wage Premiums in Canada 2000 to 2012

It is well documented that unionised workers earn significantly more than their non-union counterparts. However, over the last three decades, the union wage premium along with overall union coverage has fallen in most industrialized economies. Though the principal causes are still under dispute, the effects of technological change, managerial opposition, globalization and other factors have clearly lessened the bargaining power of labour with respect to employers. Given the commensurate rise of non-standard work and inequality in most developed nations, this paper examines the extent to which unions can still provide some immunity against the pressures of these "new labour market realities". Using data from the Canadian Labour Force Survey for the years 2000-2012 inclusive, we estimate union wage premiums amongst historically disadvantaged groups: i.e., youth, women, low wage workers, immigrants, Aboriginals and workers in non-standard jobs. The results suggest that across almost every dimension of vulnerability or disadvantage used in the paper, unions are associated with a larger than average positive impact on workers' earnings. The findings support the powerful redistributive role that unions still play in contemporary economies especially for the most vulnerable.