Trade Competition and the Decline in Union Organizing: Evidence from Certification Elections

We assess whether and why trade competition partly explains the sharp decline in U.S. workers’ attempts to organize labor unions in recent decades. We find that between 1990-2007, import competition due to the “China Shock” lowered union certification elections by 4.5% among workers in manufacturing industries directly exposed to it, and by 8.8% among workers indirectly exposed through its effect on their local labor market. Consistent with a simple model of workers’ decision to seek union representa- tion, we show that direct exposure lowered the expected wage gain from unionization, whereas indirect exposure increased the cost of job loss, both of which discourage worker organizing.