Question

Question 15

(a) What factors and forces led to the creation of labor unions in the U.S.A.

(b) Explain at least two factors that determine why union wage is generally higher than non-

union wage.

(c) Draw a well-labeled graph to illustrate the key parts of your answer in (b) above.

Answer 1

(a) The labor movement in the US was led due to the protection of the common interest of the workers. For the workers, industrial sectors fought for better wages, safer working conditions and reasonable hours of work. It also involved giving health benefits and aid when a worker is injured or retires.

(b) Union wages are higher than non-union wages because these workers in a union are able to influence the market wages of a particular industry and have some bargaining power over the wages earned. Unions are democratic institutions whose aim is to improve the economic conditions of their members. In order to raise wages, the union tries to negotiate or put pressure on the employers unlike in nonunion wage market.

(c)