Effects of Trade Unions on Workers’ Job Satisfaction: Evidence from China

Abstract

This study investigates the effect of trade unions on workers’ job satisfaction in China, based on panel data analyses that accommodate unobserved heterogeneity and the sorting problems—dissatisfied workers are more likely to be union members, and workplaces with poor working conditions are more likely to result in establishing unions. Based on data from the China Family Panel Studies, econometric models are estimated to evaluate the magnitude of the effect of the dynamic change in union membership status (union membership history) on job satisfaction. The results show that while unions effectively improve members’ job satisfaction and union effects vary by household registration type (urban versus rural hukou), unions fail to impress their members with the benefits they offer. The study offers several policy recommendations for rural hukou workers to benefit from union membership more effectively than they do now.

KEYWORDS:

• Trade unions
• job satisfaction
• employee voice
• industrial relations
• China family panel studies

Acknowledgements

I gratefully acknowledge the support of the Ryoichi Sasakawa Young Leaders Fellowship Fund 2018 and Waseda University Grant for Special Research Projects (Project number: 2022C-419), which substantially advanced the current study. The data source for this analysis, “China Family Panel Studies,” is delivered by the Institute of Social Science Survey of Peking University, China. The surveys were conducted through computer-assisted personal interviewing technology provided by the Survey Research Center at the University of Michigan. The survey operation was financially assisted by Project 985 of the Ministry of Education of the People’s Republic of China.

Declaration of interest

The author reports there are no competing interests to declare.

Data availability statement

Publicly available datasets were applied in this research. The data can be found in the hyperlink below.

China Family Panel Studies (CFPS) - China Family Panel Studies (CFPS) (pku.edu.cn)

Notes

1 The finding is that nonunion employees do not want to pay union dues or see little benefit from being a union member (Liu, 2010, p. 39).

2 Moreover, companies are implementing a system that resembles an agency shop. For example, although many sources of funding could be used for union activities, such as the 0.5% union dues owed by union members, the 2% payroll tax owed by firms, and government funding, the primary funding for firm-level unions comes from the companies (Ge, 2007).

3 In the three waves, the proportions of union workers were 2.84% for 2014, 7.06% for 2016, and 12.81% for 2018. The proportions steadily rose over time.

4 This item was surveyed only in 2016 and 2018.

5 As Freeman (1980) suggested, for union members, the voice function could encourage workers to remain in a job they feel dissatisfied with. Moreover, although their working conditions are enhanced, an increase in worker satisfaction may not be observed if their expectations are not fulfilled.

6 According to Booth et al. (2021), “paper unions” normally do not organize activities and may even intentionally hide themselves from workers to avoid putting in effort.