Estimating the relationship between labour market tightness, unemployment insurance benefits and union election activity

ABSTRACT

Using detailed data from the US National Labor Relations Board, we find labour market tightness, defined as the ratio of job vacancies to the number of unemployed, has a positive relationship with the likelihood of voting in favour of union representation. Specifically, a 1 SD increase in labour market tightness increases Vote Share in favour and the likelihood of union certification by roughly 1.5% and 3%, respectively. We also find that length of unemployment insurance benefits has a positive relationship with Vote Share in favour. Taken together, these results suggest that workers are more comfortable engaging in pro-union election behaviours when exogenous conditions, like labour market tightness and unemployment insurance benefit duration, shift in a way that more favourably insulates them from unemployment and income risk.

KEYWORDS:

• Job openings
• unemployment
• labour market tightness
• job search
• unemployment insurance benefits
• union elections
• unionization strategies

Disclosure statement

No potential conflict of interest was reported by the authors.

Notes

¹ Specifically, charges are often related to Discrimination Against Employees, Section 8(a)(3) of the National Labor Relations Act.

² Note that we also ran the models with the standard unemployment rate included as a covariate; however, it was ultimately excluded from the final baseline models due to multi-collinearity with the labour market tightness and income measures. Researchers have noted that the vacancy–unemployed ratio (our labour market tightness measure) is a better measure of workers’ alternative employment option; see, for example, Pissarides (2000).

³ We use a linear probability model, instead of probit, due to computational issues.