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AN INTER‐INDUSTRY ANALYSIS OF UNIONISATION IN BRITAIN*

1979; Wiley; Volume: 17; Issue: 2 Linguagem: Inglês

10.1111/j.1467-8543.1979.tb00636.x

1467-8543

GEORGE SAYERS BSIN, Farouk Elsheikh,

Labor market dynamics and wage inequality

British Journal of Industrial RelationsVolume 17, Issue 2 p. 137-157 AN INTER-INDUSTRY ANALYSIS OF UNIONISATION IN BRITAIN* GEORGE SAYERS BSIN S.S.R.C., GEORGE SAYERS BSIN S.S.R.C. Director, Industrial Relations Research Unit, University of Warwick, Coventry.Search for more papers by this authorFAROUK ELSHEIKH, FAROUK ELSHEIKH Associate Professor of Econometrics, Department of Statistics, University of Kuwait.Search for more papers by this author GEORGE SAYERS BSIN S.S.R.C., GEORGE SAYERS BSIN S.S.R.C. Director, Industrial Relations Research Unit, University of Warwick, Coventry.Search for more papers by this authorFAROUK ELSHEIKH, FAROUK ELSHEIKH Associate Professor of Econometrics, Department of Statistics, University of Kuwait.Search for more papers by this author First published: July 1979 https://doi.org/10.1111/j.1467-8543.1979.tb00636.xCitations: 29 * The authors wish to thank the following for helpful comments on an earlier draft of this paper: P. B. Beaumont of the University of Glasgow; Hugh Clegg, David Deaton, Bob Davies, and Bob Price of the University of Warwick; and R. Swidinsky of the University of Guelph. They also wish to thank Dominique Eyhaud, Brenda Jones, Gill Stephens, and, in particular, Margaret Morgan for help in compiling the data upon which this paper is based. AboutPDF ToolsExport citationAdd to favoritesTrack citation ShareShare Give accessShare full text accessShare full-text accessPlease review our Terms and Conditions of Use and check box below to share full-text version of article.I have read and accept the Wiley Online Library Terms and Conditions of UseShareable LinkUse the link below to share a full-text version of this article with your friends and colleagues. Learn more.Copy URL Share a linkShare onEmailFacebookTwitterLinkedInRedditWechat REFERENCES 1 See A. G. Hines, 'Trade Unions and Wage Inflation in the United Kingdom, 1893–1961', Review of Economic Studies, XXXI (October 1964), 221–52; 10.2307/2295897 Google Scholar 2 Orley Ashenfelter and John H. Pencavel, 'American Trade Union Growth: 1900–1960', Quarterly Journal of Economics, LXXXIII (August 1969), 434–48; Google Scholar 3 Ian G. Sharpe, 'The Growth of Australian Trade Unions: 1907–1969', Journal of Industrial Relations, XIII (June 1971), 138–54. 10.1177/002218567101300203 Google Scholar 4 R. Swidinsky, 'Trade Union Growth in Canada: 1911–1970', Relations Industrielles, XXIX, no. 3 (1974), 435–51. 10.7202/028526ar Google Scholar 5 G. S. Bain and Farouk Elsheikh, 'Trade Union Growth in Canada: A Comment', Relations Industrielles, XXXI, no. 3 (1976), 482–90. 10.7202/028730ar Google Scholar 6 G. S. Bain and Farouk Elsheikh, Union Growth and the Business Cycle (Oxford: Blackwell, 1976); Google Scholar 7 Ray Richardson, 'Trade Union Growth', British Journal of Industrial Relations, XV (July 1977), 279–82. Google Scholar 8 Farouk Elsheikh and G. S. Bain, 'Trade Union Growth: A Reply', British Journal of Industrial Relations, XVI (March 1978), 99–102. 10.1111/j.1467-8543.1978.tb00268.x Google Scholar 9 Ray Richardson, 'Trade Union Growth: A Rejoinder', British Journal of Industrial Relations, XVI (March 1978), 103–5. 10.1111/j.1467-8543.1978.tb00269.x Google Scholar 10 Farouk Elsheikh and G. S. Bain, 'American Trade Union Growth: An Alternative Model', Industrial Relations, XVII (February 1978), 75–9. Google Scholar 11 B. Burkitt and D. Bowers, 'The Determination of the Rate of Change of Unionization in the United Kingdom: 1924–1966', Applied Economics, X (June 1978), 161–72. 10.1080/758525403 Web of Science®Google Scholar 12 Farouk Elsheikh and G. S. Bain, 'The Determination of the Rate of Change of Unionization in the United Kingdom: A Comment and Further Analysis', Applied Economics, forthcoming;. Google Scholar 13 P. J. Pedersen, 'Union Growth and the Business Cycle: A Note on the Bain-Elsheikh Model', British Journal of Industrial Relations, XVI (November 1978), 373–7. 10.1111/j.1467-8543.1978.tb00293.x Google Scholar 2 William J. Moore and Robert J. Newman, 'On the Prospects for American Trade Union Growth: A Cross-Section Analysis', Review of Economics and Statistics, LVII (November 1975), 435–45. Google Scholar 15 William J. Moore, 'Factors Affecting Growth in Public and Private Sector Unions', Journal of Collective Negotiations, VI, no. 1 (1977), 37–43. Google Scholar 16 William J. Moore, 'An Analysis of Teacher Union Growth', Industrial Relations, XVII (May 1978), 204–15. Google Scholar 3 James G. Scoville, 'Influences on Unionization in the U.S. in 1966', Industrial Relations, X (October 1971), 354–61. Google Scholar 18 Alan S. Blinder, 'Who Joins Unions?', Working Paper no. 36 (Princeton, N.J.: Princeton University, Department of Economics, Industrial Relations Section, February 1972). Google Scholar 4 A. G. Hines, 'Wage Inflation in the United Kingdom, 1948–62: A Disaggregated Study', Economic Journal, LXXIX (March 1969), 66–89. 10.2307/2229629 Web of Science®Google Scholar 5 Since the first draft of the present paper was completed, another industrially disaggregated study has appeared. See P. B. Beaumont and M. B. Gregory, 'Union Membership and the Coverage of Collective Agreements in Britain', Discussion Paper no. 28 (Glasgow: University of Glasgow, Department of Social and Economic Research, November 1978). Google Scholar 6 'Membership of Trade Unions in 1969', Employment & Productivity Gazette, LXXVIII (November 1970), 1023. Google Scholar 7 See G. S. Bain and R. J. Price, Profiles of Union Growth: A Comparative Statistical Portrait of Eight Countries (Oxford: Blackwell, forthcoming), which gives considerable detail on the source, method of calculation, and reliability of the union density figures presented in Table I above. Google Scholar 8 Union density is actual union membership as a percentage of potential union membership, the latter being defined as the labour force minus employers, the self-employed, and members of the armed forces. Google Scholar 9 Union Growth and the Business Cycle, op. cit., chap. 4. Google Scholar 10 See Union Growth and the Business Cycle, op cit., 63–5. Google Scholar 11 On this point see ibid., 117–18. In addition work on American data, at the level of aggregation of both individual employees and individual manufacturing industries, suggests that the effect of unionisation upon wages is positive but insignificant when the effect of wages upon unionisation is allowed for. See Peter Schmidt and Robert P. Strauss. Google Scholar 27 'The Effect of Unions on Earnings and Earnings on Unions: A Mixed Logit Approach', International Economic Review, XVII (February 1976), 204–12, and 10.2307/2526075 Google Scholar 28 Orley Ashenfelter and George E. Johnson, 'Unionism, Relative Wages, and Labor Quality in U.S. Manufacturing Industries', International Economic Review, XIII (October 1972), 488–508. Google Scholar 12 Joseph Shister, 'The Logic of Union Growth', Journal of Political Economy, LXI (October 1953), 421–2. Google Scholar 13 'The Logic of Union Growth', 421. Google Scholar 14 Except those for females, which are predicted to be negative; see below. Google Scholar 15 R. M. Blackburn, Union Character and Social Class (London: Batsford, 1967), 119–20. Google Scholar 16 Ruth Komhauser, 'Some Social Determinants and Consequences of Union Membership', Labor History, II (Winter 1961), 53–4. Google Scholar 17 'Some Social Determinants and Consequences of Union Membership', 116–20; Google Scholar 35 G. S. Bain, The Growth of White-Collar Unionism (Oxford: Clarendon Press, 1970), 37–8. Google Scholar 36 S. and B. Webb, The History of Trade Unionism ( new edition; London: Longmans Green, 1920), 424–8 and 741–3. Google Scholar 18 See, for example, G. S. Bain, D. Coates, and V. Ellis, Social Stratification and Trade Unionism (London: Heinemann, 1973). Google Scholar 19 On this point see John T. Dunlop, 'The Development of Labor Organization: A Theoretical Framework', Insights Into Labor Issues, Richard A. Lester and Joseph Shister, editors (New York: Macmillan, 1949), 179–83. Google Scholar 20 See Bain, op cit., 73–81 for a fuller discussion of this point. Google Scholar 21 See Insights Into Labor Issues, 122–41 for a discussion of the relationship between union growth and union recognition. Google Scholar 22 Richard A. Lester, Economics of Labor (New York: Macmillan, 1941), 559–64. Google Scholar 23 Harold M. Levinson, 'Unionism, Concentration, and Wage Changes: Toward a Unified Theory', Industrial and Labor Relations Review, XX (January 1967), 202. Google Scholar 43 See also Martin Segal, 'The Relation Between Union Wage Impact and Market Structure', Quarterly Journal of Economics, LXXVIII (February 1964), 96–114. 10.2307/1880546 Web of Science®Google Scholar 24 See Bain, op. cit, 124–5 and 181–2. Google Scholar 25 Some relevant data can be obtained for 1931 from the Census of Population and the Department of Employment and for 1930 from the Census of Production, but they are generally deficient in both quantity and quality, and hence were not used in the empirical analysis. As is explained below, the analysis of the relationship between unionisation and regressors 9 (a), (b), and (c) in Table 2 was undertaken for the years 1958, 1963, and 1968. Google Scholar 26 This paper will appear late in 1979 in the 'Discussion Paper' series of the S.S.R.C. Industrial Relations Research Unit, University of Warwick. Google Scholar 27 In an inter-industry analysis, it does not matter greatly whether the wage and unemployment level in each industry are expressed in relative form (i.e. as deviations from a national average) or in absolute form. The slope of the regression remains the same regardless of which form is used; only the intercept (i.e. the constant term) will be different. The results reported above in Table 4 were obtained using relative wages and absolute unemployment. Google Scholar 28 In other words, in 1951 the white-collar category is sometimes occupations 7 (a-d) and sometimes 7 (a-e) in Table 2, whereas the manual category is sometimes occupations 7 (f-h) and sometimes 7 (e-h). Google Scholar 29 Since there was no Census of Production in 1961, the size of establishment figure for each industry in that year was obtained by interpolating between the figures for 1958 and 1963. Google Scholar 50 An 'establishment' was defined in 1951 and 1961 as 'the whole of the premises under the same ownership or management at a particular address (e.g. a factory or a mine)', and in 1971 as 'the smallest unit which can provide the information normally required for an economic Census, for example, employment, expenses, turnover, capital formation'. This change of definition tended to reduce the number of separate establishments which were reported in 1971 and to increase therefore the average number of employees per establishment. Google Scholar 51 The size of large establishments in each industry—derived by excluding firms with less than eleven employees in 1951 and those with less than twenty-five employees in 1958—-was also used in the preliminary analysis but the results were less satisfactory. Google Scholar 30 Since there was no Census of Production in 1961, the labour cost figure for each industry for that year was obtained by interpolating between the figures for 1958 and 1963. Google Scholar 31 In contrast to an 'establishment'(see note 29 above), an 'enterprise' is defined as one or more firms under common ownership or control as defined in the Companies Act 1948. A 'firm' is one or more establishments operating under the same trading name. Google Scholar 32 The authors are grateful to Malcolm Sawyer of the University of York for making available to them the C5, C4, and H58 data used in this paper, and to Michael Waterson of the University of Newcastle upon Tyne for making available to them the H63 and H68 data used in this paper. Google Scholar 33 The thirty-six industries are listed in Table 1. Except where otherwise stated, when a regression was run for sixteen or twenty-two observations, they were Industries 1–16 and 1–22 respectively in Table I. When the wage variable was included in the twenty-two industry model, Industry 17 (coal mining) was excluded as comparable wage data do not exist for this industry. Industries 24, 25, 27, 29, 31, and 36 do have comparable wage data, but these data are not included in the empirical analysis since these industries lack data on other important variables such as labour cost and size of establishment. Google Scholar 34 Except for the wage variable which is included in the multiple regression models. Google Scholar 35 See above, n. 28. Google Scholar 36 Two different sets of definitions were used for the skilled, semi-skilled, and unskilled manual worker variables. The first set was based on Guy Routh, Occupation and Pay in Great Britain (Cambridge: Cambridge University Press, 1965), table I. The second set, which was available only for 1961 and 1971, was based on the socio-economic group classification of the 1961 and 1971 Census of Population. Regardless of which set of definitions were used, however, these variables were not significantly related to either the thirty-six or the twenty-two industry pattern of unionisation in any of the three years. Google Scholar 37 In addition to NWR and CON, other regional variables were used in the preliminary analysis, but the results were not satisfactory. Google Scholar 38 The change of sign and insignificance may be due to the high correlation between labour turnover and other variables included in the model. Google Scholar 39 Some of these ratios could be constructed for 1971, but given the unpromising results for 1958, 1963, and 1968, it was not considered to be worth the effort. Google Scholar 40 The correlation coefficients between size of establishment and the various concentration ratios were as high as 0.95. Other researchers have experienced similar difficulty in separating the effects of size of establishment and concentration ratios. See, for example, W. Hood and R. D. Rees, 'Inter-Industry Wage Levels in United Kingdom Manufacturing', Manchester School, XLII (June 1974), 182; Google Scholar 63 K. Holden, 'A Cross-Section study of the Relationship Between Strikes and Market Structure in the United Kingdom', Journal of Economic Studies, V (May 1978); Google Scholar 64 M. C. Sawyer, 'The Earnings of Manual Workers: A Cross-Section Analysis', Scottish Journal of Political Economy, XX (June 1973), 154; Google Scholar 65 John Shorey, 'The Size of Work Unit and Strike Incidence', Journal of Industrial Economics, XXIII (March 1975), 185. Google Scholar 41 Of the various non-linear forms of these variables which were used, only the quadratic form of labour cost was found to be significant and then only in 1951. This form was not used in the regressions which were finally estimated, however, because labour cost was very highly correlated with its squared term, and this multicollinearity affected the regression coefficients of the other variables. Google Scholar 42 Op. cit., 439. See also Blinder, op. cit., 13. Google Scholar 43 See above, n. 28. Google Scholar 44 It might be argued that in addition to these intercept dummies, slope dummies should be employed to allow for possible changes between the years in the impact of the different regressors upon unionisation. Introducing slope dummies for each regressor would be equivalent to having a separate set of results for each year which is included in the analysis. Since Regressions 1–6 of Table 4 report a separate set of results for each year, and since the main purpose of the paper is not to measure the exact magnitude of the impact of a variable upon unionisation but to ascertain whether its impact is significant, the complexity of slope dummies was avoided. Google Scholar 45 The mean value of unemployment for the industries covered by the multiple regressions is 3.2 in 1971, 1.1 in 1961, and 0.8 in 1951. Its standard deviation is 0.41 in 1951, 0.49 in 1961, and 1.57 in 1971. Google Scholar 46 See above, p. 139. Google Scholar 47 The above changes in pay differentials occurred not only between industries but also between occupations. See William Brown, 'Incomes Policy and Pay Differentials', Oxford Bulletin of Economics and Statistics, XXXVIII (February 1976), especially 41, table 5. Google Scholar 48 The standard deviation of the inter-industry distribution of wages in the above multiple regressions is 3.59 in 1951, 7.87 in 1961, and 19.69 in 1971. Google Scholar 49 See G. S. Bain, R. Bacon, and J. Pimlott, 'The Labour Force', Trends in British Society Since 1900, ed. A. H. Halsey (London: Macmillan, 1972), 118, table 4.7. Google Scholar 50 Union density in 1951 was 26.0 per cent among females and 54.1 per cent among males; in 1961 it was 25.6 per cent among females and 53.8 per cent among males; and in 1971 it was 32.3 per cent among females and 58.3 per cent among males. Google Scholar 51 Op. cit., 428. Google Scholar 52 Using an average figure for 1951 and 1971, the proportion of part-time employees is 12.0 per cent in local government and education, 8.5 per cent in clothing, 8.1 per cent in entertainment, and 7.1 per cent in health. Footwear has the next highest percentage of part-time employees with 5.4 per cent. The rank order is not changed if the figures for 1961, which are defined differently, are taken into account. Google Scholar 53 Unpublished data from the Census of Production for 1958 reveal that the proportion of white-collar employees in manufacturing industries was 17.9 per cent in establishments of 1–199 employees, 19.1 per cent in establishments of 200–199 employees, 21.8 per cent in establishments of 500–1,499 employees, and 25.0 per cent in establishments of 1,500 or more employees. Google Scholar 54 Union density in 1948 was 30.2 per cent among white-collar employees and 50.7 per cent among manual employees; in 1964 it was 29.6 per cent among white-collar employees and 52.9 percent among manual employees; and in 1970 it was 35.2 per cent among white-collar employees and 56–0 per cent among manual employees. See Robert Price and G. S. Bain, 'Union Growth Revisited: 1948–1974 in Perspective', British Journal of Industrial Relations, XIV (November 1976), 347, table 6. Google Scholar 55 For the 21 industries covered by the multiple regression, the correlation coefficient between total white-collar employment and size of establishment was 0.32 in 1951, 0.53 in 1961, and 0.54 in 1971 and that between clerical workers (CW) and size of establishment was 0.60 in 1951, 0.68 in 1961, and 0.69 in 1971. In contrast, the correlation coefficient between employer-managers and size of establishment was -0.38 in 1951, -0.05 in 1961, and -0.20 in 1971. Google Scholar 81 If data on size of establishment or size of employing unit were available to allow industries 22–36 to be taken into account, the relationship between size and white-collar employment would be even more pronounced. For many of these industries are characterized by large size of establishment (and often by a single public employer) as well as by a large proportion of white-collar employees. For example, in 1961 the proportion of white-collar employees was 28.9 percent in gas, 32.1 per cent in electricity, 65.5 per cent in national government, 51.8 per cent in local government and education, 67.2 per cent in health, 42.9 per cent in air transport, and 89.9 per cent in insurance, banking, and finance. The mean of the white-collar variable in 1961 was 27.0 per cent for all thirty-six industries and 19.0 per cent for Industries 1–21. Google Scholar 56 Kornhauser, op. cit., 35 ascertained from the data generated by two national public opinion surveys in the United States in the early 1950s that the degree of unionisation there was about the same among skilled, semi-skilled, and unskilled workers. Google Scholar 57 The best-known example of this phenomenon has occurred in the construction industry. Skilled workers made up over 50 per cent of the labour force of this industry during the period 1951–71, and its degree of unionisation declined from 44–4 percent in 1951 to 33.4 percent by 1971. Google Scholar 58 Op. cit., 183. Google Scholar 59 See above, p. 150. Google Scholar Citing Literature Volume17, Issue2July 1979Pages 137-157 ReferencesRelatedInformation