Working Class Power: The Decline and Reconfiguration of Trade Union Power Resources in the 21st Century

Abstract

This thesis comprises four studies investigating the formation, uses, and interactions of trade union power resources. By applying a longitudinal approach, the studies analyse a variety of outcomes associated with four sources of labour’s power. The aim of this thesis is to explain how the power resources of labour, particularly those of trade unions, have been impacted by neoliberal reforms to institutions and the restructuring of labour markets for a broadly defined working class of wage earners. The main data sources used are original survey data, the Swedish Labour Force Survey (LFS) and the international EU KLEMS database.

Study I used data from Swedish surveys spanning 1997 to 2018 to investigate whether changing conditions for trade unions are associated with changing attitudes to trade union-related issues. While union density declined due to structural and institutional shifts, attitudes toward wage negotiation remained stable. Union members favoured collective bargaining. Vulnerable labour market segments showed stronger support for unions. Overall, individuals endorsing union engagement often benefit most from union involvement in employment matters.

Study II examined the impact of Ghent system reforms on Swedish union membership from 2007 to 2008. Amidst a notable decline in union density – which has been attributed to tax deduction removal and increased unemployment insurance fees – the study explored the interplay between these reforms and structural changes to the labour market. Analysing data from Swedish LFS identified two main factors that contribute to the decline: changes in labour force composition and direct Ghent system effects, which especially affected exposed worker categories. The results reveal cyclical union density patterns, disrupted by Ghent system changes, with increased temporary and younger employees driving the decline, particularly in specific sectors. Study III’s point of departure is from previous research that found that individuals typically join unions before the age of 35. This trend is most notable among younger employees, often in sectors that have high atypical employment and lack union representation. Previous studies focused on fixed individual characteristics when analysing membership likelihood, overlooking how employment paths, like transitioning from temporary to permanent roles, affect union density and membership. This study examines how job sequences influence youth union membership using Swedish labour data. The findings reveal varied effects based on age and time, with stable permanent contracts promoting membership and younger workers showing lower commitment due to limited labour market exposure. In particular, full-time students and workers drifting between spells of unemployment, employment, and studies are less likely to choose union membership and commit over the long term, with institutional changes to the Ghent system mediating these effects.

Study IV departs from the fact that advanced economies have seen a decline in the wage share compared to profits. This decline is influenced by factors like decreasing union density and collective bargaining coverage. However, the impact varies based on institutional contexts. Analysing data from 22 OECD countries, the study explored how labour market institutions and wage-setting mechanisms affect income distribution across skill groups. Union density increases the wage share, especially where statutory minimum wages are absent, while the effect of collective bargaining is more nuanced. Statutory minimum wages benefit medium- and low-skilled workers but negatively interact with collective bargaining for medium-skilled groups. The findings highlight how wage-setting institutions influence outcomes for workers, offering key insights for balancing collective bargaining and statutory wage policies to promote equitable income distribution.

The main conclusions from these studies point to the complexity of interactions between the power resources of the working class of wage earners. Of importance is also an implied resistance to neoliberal reforms to institutions to maintain unions’ power resources or to rely on other sources of power when institutional power diminishes, as well as a general shift in the class-based power dynamics in industrial relations. White-collar professionals and academics in Sweden have increased their bargaining power while the power of blue-collar workers has declined, suggesting an increasingly fragmented worker movement. At a broader level, the dynamic between capital and labour has shifted in capital’s favour as the share of wages in relation to profits are in decline, suggesting labour is unlikely to improve the wage share unless collective bargaining or adequate statutory minimum wages are introduced, highlighting the need for a nuanced approach to wage regulation.