There's been a decent amount of commentary on various blogs today regarding the connection between unionization rates and unemployment. Some have made the contention that high unionization rates lead to high unemployment, while others say the issue isn't so cut and dry. The anti-union camp cites the example of California, which at a rate of 17.2%, has the tenth highest union membership rate (union members as a percent of total employment) and the third highest unemployment rate. However, rather than looking at one individual state, we thought a comparison between unionization and unemployment rates in all fifty states and Washington DC would provide a more complete picture.
In the 23 states where unionization rates are above average, the average unemployment rate as of March 2010 was 9.61%. In Washington DC and the 27 states where levels of unionization are below average, the average unemployment rate is nearly 100 basis points lower (8.65%). Likewise, if we narrow our focus to the ten states with the highest unionization rate, and the ten states with the lowest unionization rates, the average high union state has an unemployment rate of 10.34%, while the ten low union states have an average unemployment rate of 9.08%.
As with any set of data, however, there are exceptions. For example, of the ten states with the lowest unionization rates, four still have unemployment rates in the double-digits. Likewise, the three states with the highest unionization rate (New York: 25.2%, Hawaii: 23.5%, and Alaska: 22.3%) have unemployment rates that are below the national average of 9.08%. As of March 2010, New York, Hawaii, and Alaska had unemployment rates of 8.6%, 6.9%, and 8.6%, respectively. Based on a quick look at the data of the fifty states, it would appear that although there is some correlation between high levels of unionization and high unemployment, the connection is not as cut and dry as some would lead you to believe.
