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Why does the US, a society with low union membership rates have much higher median salaries both before and after taxes and government benefits than in Europe w

Why does the US, a society with low union membership rates have much higher median salaries both before and after taxes and government benefits than in Europe where there are lots of powerful unions? https://data.oecd.org/hha/household-disposable-income.htm https://data.oecd.org/hha/household-disposable-income.htm

wing-_-nuts 5y ago
Are you subtracting wages lost to both employer AND employee contributions to health insurance, co-pays and the like? That's the only way it's a fair comparison. Hell, even if we do earn more after accounting for that, living in a society with universal healthcare is worth something all it's own.
- missedthecue 5y ago
  Yes. From my link - "Information is also presented including social transfers in kind, such as health or education provided for free or at reduced prices by governments and not-for-profit organisations."
johnebgd 5y ago
Healthcare costs in the USA eat those gains.
- missedthecue 5y ago
  The OECD numbers adjust for both healthcare and education. Americans are still making 25% more than Western European counterparts.
  - wing-_-nuts 5y ago
    Do they? I could have sworn they just accounted for taxes. Do you have a citation? Do they also count employer contributions to healthcare premiums?
- deleted 5y ago
  [deleted]
- devcpp 5y ago
  Not exactly something unions will solve, and not enough to destroy those gains on average.
JumpCrisscross 5y ago
We’re better at preserving the threat of new entrants. Truckers routinely start their own businesses here. That’s tougher in most of Europe, where labor laws making hiring and firing strikingly expensive.
- moooo99 5y ago
  > That’s tougher in most of Europe, where labor laws making hiring and firing strikingly expensive. That is true. Personally and anecdotally I find that to be a good thing. I feel much more comfortable with 35h work week, 35 days of paid vacation making €60k without living in the fear of getting fired the next day. Even if I could get more money in the US, I highly doubt that my standard of living would increase enough to justify the uncertainty that would come with this move. And I think that difference is even more extreme with jobs that don’t require years of education beforehand.
  - JumpCrisscross 5y ago
    They’re frankly two perfectly good equilibria that do different things well. It’s part of what makes us good allies.
simonh 5y ago
Medians don’t tell the whole story. Incomes for high wage earners in the US have increased disproportionately compared to European countries, while wages for middle and low income groups stagnated in comparison. The value of benefits isn’t takin into account. Health care is a huge driver of inequality in the US. Tens of millions of you get minimal health care, and even many on health care plans only qualify for a fraction of the treatments Europeans take for granted. Education is another example. Overall the US system is fine, but the funding model is appallingly uneven with the majority of public funds ending up going to schools in wealthy areas. The national funding and provision models in Europe are far more egalitarian and, as with health care, much more efficient. Even so, there’s still a legitimate gap in the US favour here. That can’t be denied. Arguably what Europeans get in return is peace of mind and a society that has their back. They know that whatever happens to them, they will get decent health care, their kids will get a decent education, and they’re more likely to get fair treatment from their employer.
- decebalus1 5y ago
  > They know that whatever happens to them, they will get decent health care, their kids will get a decent education, and they’re more likely to get fair treatment from their employer. And as a former manager once told me, 'one needs the constant fear of homelessness to keep workers in line'. That is the real engine of innovation /s
  - simonh 5y ago
    I don’t see how that can work. People in fear are going to be more risk averse, surely, and innovation is always risky. I mean clearly the US is still a very innovative economy, it’s not like everyone is constantly in fear of starvation any second. But still, I don’t see how fear promotes innovation. There are many economic and societal factors in the US that promote risk taking and innovation, but fear of hunger in oppressed workers isn’t one of them.
    - decebalus1 5y ago
      It doesn't, I was being sarcastic.
hellotomyrars 5y ago
Anecdotally I will say that my union has doubled the wages of its members in the last 10 years. There are also twice yearly cost of living raises. As another commenter has pointed out, median doesn’t tell the story accurately when it’s being pushed largely by incredibly disproportionate growth in top 10% of earners. I love my Union, and I’ll grant you that Unions aren’t universally good due to people being shitty but I wholly believe in Unions and hope more people organize. It is the only meaningful way for labor to get what they deserve.
decebalus1 5y ago
Bull.. ahem.. shit. If you want a fair comparison, compare the incomes of union workers vs non-union workers within the same country or COL area doing similar jobs. If unions would bring wages down, corporations would be all over that and will sign you up on the first day. Use your head, damn it.

wing-_-nuts 5y ago

Are you subtracting wages lost to both employer AND employee contributions to health insurance, co-pays and the like? That's the only way it's a fair comparison. Hell, even if we do earn more after accounting for that, living in a society with universal healthcare is worth something all it's own.

missedthecue 5y ago
Yes. From my link - "Information is also presented including social transfers in kind, such as health or education provided for free or at reduced prices by governments and not-for-profit organisations."

johnebgd 5y ago

Healthcare costs in the USA eat those gains.

missedthecue 5y ago
The OECD numbers adjust for both healthcare and education. Americans are still making 25% more than Western European counterparts.
- wing-_-nuts 5y ago
  Do they? I could have sworn they just accounted for taxes. Do you have a citation? Do they also count employer contributions to healthcare premiums?
deleted 5y ago
[deleted]
devcpp 5y ago
Not exactly something unions will solve, and not enough to destroy those gains on average.

JumpCrisscross 5y ago

We’re better at preserving the threat of new entrants. Truckers routinely start their own businesses here. That’s tougher in most of Europe, where labor laws making hiring and firing strikingly expensive.

moooo99 5y ago
> That’s tougher in most of Europe, where labor laws making hiring and firing strikingly expensive. That is true. Personally and anecdotally I find that to be a good thing. I feel much more comfortable with 35h work week, 35 days of paid vacation making €60k without living in the fear of getting fired the next day. Even if I could get more money in the US, I highly doubt that my standard of living would increase enough to justify the uncertainty that would come with this move. And I think that difference is even more extreme with jobs that don’t require years of education beforehand.
- JumpCrisscross 5y ago
  They’re frankly two perfectly good equilibria that do different things well. It’s part of what makes us good allies.

simonh 5y ago

Medians don’t tell the whole story. Incomes for high wage earners in the US have increased disproportionately compared to European countries, while wages for middle and low income groups stagnated in comparison. The value of benefits isn’t takin into account. Health care is a huge driver of inequality in the US. Tens of millions of you get minimal health care, and even many on health care plans only qualify for a fraction of the treatments Europeans take for granted. Education is another example. Overall the US system is fine, but the funding model is appallingly uneven with the majority of public funds ending up going to schools in wealthy areas. The national funding and provision models in Europe are far more egalitarian and, as with health care, much more efficient. Even so, there’s still a legitimate gap in the US favour here. That can’t be denied. Arguably what Europeans get in return is peace of mind and a society that has their back. They know that whatever happens to them, they will get decent health care, their kids will get a decent education, and they’re more likely to get fair treatment from their employer.

decebalus1 5y ago
> They know that whatever happens to them, they will get decent health care, their kids will get a decent education, and they’re more likely to get fair treatment from their employer. And as a former manager once told me, 'one needs the constant fear of homelessness to keep workers in line'. That is the real engine of innovation /s
- simonh 5y ago
  I don’t see how that can work. People in fear are going to be more risk averse, surely, and innovation is always risky. I mean clearly the US is still a very innovative economy, it’s not like everyone is constantly in fear of starvation any second. But still, I don’t see how fear promotes innovation. There are many economic and societal factors in the US that promote risk taking and innovation, but fear of hunger in oppressed workers isn’t one of them.
  - decebalus1 5y ago
    It doesn't, I was being sarcastic.

hellotomyrars 5y ago

Anecdotally I will say that my union has doubled the wages of its members in the last 10 years. There are also twice yearly cost of living raises. As another commenter has pointed out, median doesn’t tell the story accurately when it’s being pushed largely by incredibly disproportionate growth in top 10% of earners. I love my Union, and I’ll grant you that Unions aren’t universally good due to people being shitty but I wholly believe in Unions and hope more people organize. It is the only meaningful way for labor to get what they deserve.

decebalus1 5y ago

Bull.. ahem.. shit. If you want a fair comparison, compare the incomes of union workers vs non-union workers within the same country or COL area doing similar jobs. If unions would bring wages down, corporations would be all over that and will sign you up on the first day. Use your head, damn it.