Recent Longitudinal Evidence of Size and Union Threat Effects by Gender on Wages and Benefits
AbstractIt is evident (empirics based on data from the NLSY79 covering years 2000 through 2012) that both male and female workers in medium/larger establishments receive not only higher wages but also have a higher probability of participating in benefit programs than those in smaller establishments. This reinforces the well-documented "size" effect. Further, the firm size wage effects are much larger for men than women. The union wage effect decreases with establishment size for both genders. This supports the argument that large nonunion firms pay higher wages to discourage the entrance of unions (i.e., the "threat" effect argument). In addition, the union wage premium is higher for males across firm sizes relative to females. This implies that unions in the large establishments may have a role to play in achieving a narrowing of the gender union wage gap. Further, given the presence of noticeable gender differences in estimated union effects on benefits [such as health insurance, maternity leave, life insurance, and retirement], unions should not treat both genders similarly.
Keywords: size effect, threat effect, fringe benefits, compensation, gender, union-nonunion, random effects, NLSY79
JEL Classification: J16, J31, J32, and J51