The Impact of Unionization on the Wage of Hispanic Workers

This paper explores the role of unionization on the wages of Hispanic workers in the US from 1994 to 2013. Preliminary evidence indicates a 25 to 29 percent positive wage gap between unionized Hispanic male workers and their non-unionized counterparts. Once we control for socio-demographic characteristics and account for non-random selection into union membership, there is still a positive effect of union membership on the wages of male Hispanic workers. Estimates suggest that had non-unionized Hispanic male workers be instead unionized, the average real hourly wage of male Hispanics would have between 6 and 13 percent higher each year during the 1994-2013 period. Implementing the re-weighting approach along the wage distribution reveals that unions may act differently for different ethnic groups, while Hispanics relatively unskilled would benefit the most from unionization. Results suggest different “needs” of being unionized for workers of different skills and race. * Rienzo: National Institute of Economic and Social Research (NIESR), 2 Dean Trench St, London SW1P 3HE (email: [email protected]); Vargas-Silva: COMPAS, University of Oxford, 58 Banbury Road, Oxford OX2 6QS (email: [email protected]).