Washington, D.C. — A new analysis from the Center for American Progress Action Fund provides some of the first empirical evidence that unions are associated with more wealth—and more economic security—for middle-class Americans. CAP Action’s analysis of the Federal Reserve Board’s Survey of Consumer Finances, or SCF, data strongly suggests that strengthening unions is key to improving Americans’ financial well-being.
“Building a strong middle class does not happen on its own. It requires helpful policies such as making it easier for people to join a union and bargain collectively,” said Christian E. Weller, Senior Fellow at CAP Action.
“We have known for a long time that unions raise wages, improve benefits, and reduce inequality. Now we know that unions also help build wealth for the middle class,” said David Madland, CAP Senior Fellow and Senior Advisor to the American Worker Project at CAP Action.
CAP Action’s analysis reveals that the median middle-income union household typically has more wealth than the median nonunion middle-income household, and this gap is apparent in each year since 1989, the first year for which consistent SCF data are available. In 2013, for instance, the median middle-class union household held $50,800 (in 2013 dollars) in wealth—nearly 90 percent more than the median middle-class nonunion household’s $27,000 in wealth. Further, among the middle class, the median union household has a higher wealth-to-income ratio than the typical nonunion household in every year analyzed—or in other words, union households have more wealth even after accounting for differences in income.
CAP Action’s analysis also finds in every year that middle-class union households are less likely to have zero or negative net worth, are more likely to be homeowners, and are more likely to have defined benefit pension plans.
Click here to read “Building Middle-Class Wealth Through Unions” by Christian E. Weller, David Madland, and Alex Rowell.
For more information on this topic or to speak with an expert, contact Allison Preiss at [email protected] or 202.478.6331.