A critique of union density as a measure of union strength in South Africa
Stellenbosch Working Paper Series No. WP04/2023Publication date: November 2023
Author(s):
[protected email address] (Department of Economics, University of the Western Cape.)
Trade unions are widely seen to exert their power through political influence, ability to organise industrial action, financial resource allocation, and ability to exact a wage premium. However, the only direct metric for union power is union density, the proportion of employees who are members of trade unions. Upon closer examination it is doubtful whether union density is indeed a reliable indicator of union power. This conclusion is reached through several ways, first, there is little to no correlation between union density and South African policy outcomes. Second, the post-1996 agency shop agreement regime obscures the true extent of union density thereafter, and in turn does not fully capture the extent of financial resource allocation. Third, whilst union membership is conventionally seen as an obvious lever to exact wage premiums, the conditionality created by race, gender and seniority challenges this view. A speculative re-estimate of union density is conducted to show how agency shop agreements may have under-represented the true extent of union density.
JEL Classification:J51, J53
Keywords:Union density; Trade unions; Labour market; South Africa
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Upcoming Seminars
Monday 28 July 202512:00-13:00
Dr Neil Rankin: Ceo Of Predictive Insights & Stellenbosch University
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Prof Willem Boshoff: Stellenbosch University
Topic: "Two competing approaches in South African competition policy: merger control and anti-cartel enforcement over the past 30 years"
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Professor Johan Fourie: Stellenbosch University
Topic: "Economic History: TBC"
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25 Jul 2025 Budget hurdle cleared, but US tariff implementation remains a riskIt was another big week on the local political front, but with some constructive momentum. On the trade front, ahead of next week’s 1 August deadline, Trump announced another “massive” trade deal with Japan. The upcoming week is busy, with a slew of global and domestic data releases and several monetary policy decisions, including the SARB....
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