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Vulnerable Seniors: Unions, Tenure, and Wages following Permanent Job Loss

In contrast to nonunion workers, reemployment wages of workers displaced from unionized jobs decline with tenure on the lost job. This finding cannot easily be explained by firm‐ or industry‐specific human capital accumulation, deferred‐pay policies, standard matching models, or a correlation between tenure and reentry rates into unionized jobs. Possible explanations include negative selection of senior union workers and a negative causal effect of unionism on workers' alternative skills. Despite a much flatter predisplacement tenure‐wage profile, displaced union workers' wage losses increase with tenure at a rate comparable to or higher than those of nonunion workers.