Though public-sector workers have more generous benefits, these benefits do not make up for lower wages and salaries for most workers. The pay gap is especially large among workers with bachelor’s degrees or more education, who make up the majority of public-sector workers. This brief shows that collective bargaining rights and union strength help local government workers narrow the pay gap with private-sector workers. The right to bargain collectively over pay is associated with higher union density (union membership as a share of the workforce). To do so, we estimate pay differences between local government workers and private-sector workers with similar education and experience. This brief examines how public-sector workers in states like Virginia-with restricted collective bargaining rights-have fared in recent years compared with public-sector workers in states that have well-established collective bargaining rights. However, union organizing efforts are just beginning in that state, where collective bargaining rights have historically been restricted. Local government workers in Virginia recently won the right to bargain collectively over pay. Other states that have restricted collective bargaining rights should expand them. Virginia is moving in the right direction. Other states have recently made changes that strengthen or weaken collective bargaining rights for public-sector workers. What can be done about it: Virginia, which has one of the largest public-sector pay gaps, recently took the small step of allowing employers to voluntarily bargain with unions representing local government workers. Unions reduce inequality, promote social mobility, and advocate for better public services. Why it matters: Closing the public-sector pay gap especially helps Black workers and women, who are overrepresented among local government workers.
What this report finds: States where teachers, police, firefighters, and other local government workers have stronger collective bargaining rights and higher union membership have smaller gaps between these workers’ pay and the pay of private-sector workers with similar educational attainment, age, state of residence, and hours worked.
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