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1987 Ad

AFL-CIO American Federationist, The, March 19, 1988 by Stephen Singer

MAKING NEW INROADS: Union Bargaining in 1987

Contracts that include cost-of-living allowances (COLAs) to keep up with inflation triggered an average gain of 2.6 percent. Wage adjustments stemming from COLA reviews in 1987 averaged 43 percent of earnings increases during the COLA review period, according to the BLS.

In addition, workers who won wage increases can look forward to a 3.3 percent gain in deferred adjustments in 1988, the BLS reported.

In estimating the value of the settlements its survey covers, BLS does not include lump-sum payments, profit-sharing arrangements, stock bonus plans, cost-of-living adjustments or worker retraining funds. Such contract elements recently have increased in importance, so that the real value of settlements is understated.

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Union members' wages and benefits are increasing more slowly than earnings for non-union workers, according to the BLS. Employer costs for union workers' wages and benefits increased by 2.8 percent in 1987, while the cost for non-union workers rose by 3.6 percent. Much of this rise is due to the 4.4 percent average raises given to managerial employees.

Though non-union workers gained larger increases, they have a long way to go to close the $123-a-week gap between their median earnings and what union members earned in 1987. The BLS reported that median weekly earnings of union members stood at $465 and non-union workers were paid $342, a difference of 36 percent.

Catching up from years of restrained settlements, state and local government workers won effective wage increases averaging 5.7 percent in 1987, according to the BLS. Though higher than the wage rate increases won by private sector employees, the average first-year public sector wage increase was down slightly from the 6 percent gain in 1986.

Despite the wage gains for private sector workers, pay and benefit hikes of 3.6 percent lagged behind the year's 4.5 percent increase in the cost of living, which was three times the 1986 rate.

In addition to economic shifts, political changes affected collective bargaining in 1987. The waning strength of the Reagan Administration deprived federal policy-makers of opportunities to help fashion anti-union strategies that in the early 1980s sent the message to employers nationwide that union-busting was an acceptable bargaining tactic.

The level of unemployment also served as an economic signpost during contract talks. The average annual rate stood at 6.2 percent and in December was 5.8 percent, the lowest level since 1979 and a sharp drop from the 10.8 percent in 1982 induced by the Reagan recession.

But economic gains remained skewed during Reagan's years in the White House. Though employment rose in all industries in 1987, with an increase of 400,000 in manufacturing during the year, the number of manufacturing jobs was off by 1.7 million since 1979 peak levels. This fact was not lost on workers and their union representatives in manufacturing industries as they entered contract talks aiming to preserve jobs immediately and in the near future, while trying to help strengthen the ability to better compete in domestic and foreign markets.

1987 Ad

AFL-CIO American Federationist, The, March 19, 1988 by Stephen Singer

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