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Unions, Race, Ethnicity, and Wealth: Is There a Union Wealth Premium for People of Color?

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Abstract

Black, Latinx, Native American, and many Asian households often have less wealth than White ones do. This racial wealth gap may be smaller among union members than nonunion members if union membership positively correlates with more wealth and if that correlation is greater among people of color than among White households. We use summary statistics and regression analyses based on the Federal Reserve’s triennial Survey of Consumer Finances from 1989 to 2019 for our analyses. We find that households of all races and ethnicities have more wealth as union members than as nonunion members. This increase is larger for Black households and households of other races than it is for Whites.

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Notes

  1. The public data from the Survey of Consumer Finances does not provide details on subpopulations other than White, Black, or Latinx households. The category of others includes Asian-Americans, Pacific Islanders, Native Americans, and Alaska Natives, among others.

  2. The data we use asks people whether they are covered by a collective bargaining agreement (CBA), not whether they are members of a union. We use the term union members throughout this paper to refer to those covered by a CBA to make the discussion simpler.

  3. The conclusions do not materially change when we separate the summary data by race and ethnicity. The main summary data findings, though, apply primarily to African Americans and those who identify as Latinx/Hispanic.

  4. Liquid savings appear to mitigate financial shocks less for people of color than for Whites (Despard et al. 2018).

  5. Additional summaries, not shown here, by union membership and tenure indicate that union membership correlates with more patience, saving and risk taking among people of color after holding tenure length constant, while the correlation is weaker among Whites.

  6. Table 9 in the appendix shows all parameter estimates.

  7. We exclude public sector employees from our sample rather than estimate the sample on public sector workers only to preserve observations.

  8. We tested interaction effects of these variables with union membership and found no systematic differences.

  9. Authors’ calculations based on SCF.

  10. Authors’ calculations based on SCF.

  11. We only show fixed effects results. Random effects estimates show similar results.

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Acknowledgments

This paper has greatly benefited from the insights of two reviewers and discussions with Alex Rowell and Danyelle Solomon. We are also very grateful to Divya Vijay for her excellent research assistance. All remaining errors are our sole responsibility.

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  1. Department of Public Policy and Public Affairs, University of Massachusetts Boston, 100 Morrissey Boulevard, Boston, MA, 02125, USA

    Christian E. Weller

  2. Center for American Progress, 1333 H Street NW, Washington, DC, 20005, USA

    David Madland

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Appendix

Appendix

Table 7 DC account and 401(k) balances of spouses by union membership of partner
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Table 8 College Education, Student Loan Debt, Inheritances and Gifts By Race, Ethnicity, and Union Membership
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Table 9 Complete model estimates for all years
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Weller, C.E., Madland, D. Unions, Race, Ethnicity, and Wealth: Is There a Union Wealth Premium for People of Color?. J Econ Race Policy 5, 25–40 (2022). https://doi.org/10.1007/s41996-020-00078-7

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