Question

What is an industrial effect of unions on pay level?

1)Industries having highest union wage premium had the lowest employment decrease in the 1970s.

2)Wage premiums come with cost to labor making the firms less profitable.

3)Union workers are paid lesser than nonunion workers on an average.

4)Unions are able to bargain larger-than-normal increase in firms that created specific assets.

Answer 1

The Industrial effect of Unions on pay level is that the Unions are able to bargain larger than normal increase in firms that created specific assets since the unions are group of laborers coming together in larger number to get their demands fulfill which creates a greater impact than what non unionized labors put forth .

Also Since the firms creating specific products / Assets are mostly labor intensive industries which are highly dependent on labor hence not fulfilling their demand result in loss of production as they go on strikes and create undue pressure on the management to get their demands completed hence when unions came into existence it increased the level of bargaining of the labor with the industries and also resulted in decreasing the suppression of the labor by the industrialist.