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Union Children Do Well

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Who else is not at all shocked that the children of union families have higher social mobility as adults? Why, it’s almost like growing up in an economically stable household allows children to worry about things like school instead of homelessness!

A new study suggests that unions may also help children move up the economic ladder.

Researchers at Harvard, Wellesley and the Center for American Progress, a liberal think tank, released a paper Wednesday showing that children born to low-income families typically ascend to higher incomes in metropolitan areas where union membership is higher.

The size of the effect is small, but there aren’t many other factors that are as strongly correlated with mobility. Raj Chetty of Stanford and Nathaniel Hendren of Harvard, who pioneered this method of examining economic mobility, established five factors that are strongly correlated with a low-income child’s likelihood of making it into the middle class: the rate of single motherhood in an area, the degree of inequality, the high school dropout rate, the degree of residential segregation, and the amount of social capital, as measured by indicators like voter turnout and participation in community organizations.

Single motherhood is the most strongly correlated factor with mobility. The latest study, which relied on the Chetty/Hendren data, says union membership is roughly as strongly correlated with mobility as the other four factors.

The researchers looked at the expected income of people ages 29 to 32 whose parents were at the 25th percentile of income nationally when they were teenagers. They found that a 10-percentage-point increase in the rate of unionization in an area coincided with a rise of an additional 1.3 points on the income distribution as the average child becomes an adult.

Let’s take the example of the average metro area where about 16 percent of workers were unionized, and children whose parents were in the 25th percentile of income earners nationally ended up at the 40.7 percentile on average as adults. A simple application of the author’s finding implies that, in a metro area where 26 percent of workers were unionized, the average child from the same place in the income ladder would end up in the 42nd percentile.

The correlation remains statistically significant even when the researchers controlled for a variety of other social and economic variables, like the child poverty rate and median house value.

“I would have thought we could have found things that might have killed off the effects,” said Richard B. Freeman, a labor economist at Harvard who was one of the study’s authors. “And we basically didn’t.”

Obviously we need more studies along these lines, but it’s quite clear that union children do better as adults than non-union children.

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