The Wrong Target: Public Sector Unions and State Budget Deficits

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POLICY BRIEF

October 2011

The Wrong Target: Public Sector Unions and

State Budget Deficits

Sylvia A. Allegretto, Ken Jacobs and Laurel Lucia*

Introduction

Te economy ell o a cli in 2008 as we experienced the most devastating downturn since the GreatDepression. Unemployment hit double digits resulting in signicant economic hardship and increasingdemands on government saety nets and services to help those in need. At the same time, state revenuesplummeted as workers lost their jobs and business activity contracted. As states struggled to balancetheir budgets in this weak economic climate, public ocials in multiple states argued that the scal gaps were due to government workers and their unions.

Te allout rom the political jostling around public workers has been that hundreds o bills related topublic employees and unions were introduced in state legislatures—most o which sought to restrict

public sector unions. At least twelve states have signicantly restricted collective bargaining through new legislation in 2011 including: Wisconsin, Ohio, Indiana, Arizona, Idaho, Michigan, New Hampshire,Oklahoma, South Carolina, ennessee, Utah and Wyoming. i A common rationale or these proposals isthat growing costs associated with public sector workers, especially union-represented workers, are at theroot o state budget decits. Governor Scott Walker o Wisconsin said “we can no longer live in a soci-ety where the public employees are the haves and taxpayers who oot the bills are the have-nots.” ii A con-servative columnist in the Daily Journal noted “like Governor Christie, he [Governor Walker] decidedto actually x the problems that brought Wisconsin to this point. His budget limits government collec-tive bargaining...”iii But, were public sector workers and their unions to blame or state budget problems?

In this brie, we review the relevant research and analyze the relationship between public sector workers,their unions and state budget decits. Our analysis nds that the size o the public sector workorce per

Center on Wage andEmployment Dynamics

Institute for Research on Labor and EmploymentUniversity of California, Berkeley

* Sylvia A. Allegretto, Ph.D. is an economist and deputy chair of the Center on Wage and Employment Dynamics at theInstitute for Research on Labor and Employment, University of California, Berkeley. Email: [email protected].

*Ken Jacobs is the Chair of the UC Berkeley Center for Labor Research and Education. Email: [email protected].

*Laurel Lucia is a policy analyst at the UC Berkeley Center for Labor Research and Education. Email: laurel.lucia@ berkeley.edu.

Our thanks to Luke Reidenbach for research assistance, Dave Graham-Squire for his helpful insights, and Chaz Lowe for his help in preparing this research brief.



2 The Wrong Target: Public Sector Unions and State Budget Deficits

thousand residents is not growing and previous studies have ound that public sector compensation, asa share o public budgets, has not grown. Researchers have consistently ound that public sector workersare not compensated more highly than their private sector counterparts ater taking into account level o education, experience and other important actors. Finally, our regression analysis shows large state de-cits were due, in large part, to the decline in house prices and not due to public sector workers and theirunions. Te bursting o the housing bubble was the precursor to the Great Recession and it is clear that

the large drop in house prices (which capture much o the deteriorating economic climate) was central.

State Deficits Hit Record Levels

Te Center on Budget and Policy Priorities analyzed trends in state budgets. Tey ound that states haveaced the largest budget shortalls on record (Figure 1) during and ollowing the Great Recession. Statedecits totaled more than $100 billion each year in scal years (FY) 2008/09 through 2011/12, peakingat $191 billion in FY 2009/10. In FYs 2009/10 and 2010/11, all but two to three states aced shortalls.iv Tese record decits have resulted in signicant cuts to much needed programs such as: public healthprograms, the educational system including signicant teacher layos, programs or the elderly anddisabled, and massive layos o the public sector workorce.v

Figure 1 Largest state budget shortalls on record

State budget shortalls have important economic consequences. Severe austerity measures implementedby states struggling to balance their budgets eectively reduce demand in an already underperorm-ing economy suering rom weak demand. Along with direct layos due to reductions in spending,contracts are cancelled with vendors and benets are cut or individuals. Te impact is multiplied asvendors reduce purchases o supplies and services and individuals have less money to spend in the localeconomy. Te impacts are urther magnied or programs like Medicaid where the reduction in statespending also lowers ederal matching unds. ax increases also suppress demand, but, depending on thenature o the tax increase, they do so to a lesser extent.vi

-$40

-$75-$80

-$45

-$110

-$191

-$130*

-$103*

-$46**

-$250

-$200

-$150

-$100

-$50

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2002 2003 2004 2005 2009 2010 2011 2012 2013

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F Y ,

i n

b i l l i o n s

* Reportedto date

** Preliminary

Source: Center on Budget and Policy Priorities 2011.

Lastrecession




Public Sector Employment has been Steady

Te large state decits have requently been blamed on a growing public sector. For example, GovernorScott Walker warned that Wisconsin “cannot grow i our people are weighed down paying or a largerand larger government.”vii However, the size o the public sector has not grown in recent years, neither interms o public sector employment levels nor public sector compensation.

State and local government workers as a share o the workorce has been relatively steady since 1979, asshown in Figure 2. Using monthly Current Employment Statistics rom the Bureau o Labor Statistics we look at state and local government jobs as a share o all jobs. We nd a small increase during eacho the ve recessions over this time period, refecting the disproportionate reduction in private sectoremployment during the recessionary periods—ollowed by a corresponding reduction in the share dur-ing the subsequent recovery and expansion periods. Te high point or the share o total employees instate and local government is typically one or two years into the recovery, as employment tends to lageconomic growth—especially in the jobless recoveries that ollowed the early 1990s and 2001 recessions.Overall, the share o workers in state and local employment averaged 14.2 percent over the thirty yearperiod and ranged rom a low o 13.6 percent at the height o the boom in 1999 to a high o 15.2 per-cent in the great recession in 2009 refecting the greater loss in private sector employment—over 5 mil-lion private sector jobs were lost that year. viii By midway through 2011, the share o workers employed

by state and local governments had allen back to 14.6 percent.

Figure 2 Public sector employment has been steady share o workorce, 1979-2011

Not only has the share o state and local government jobs remained relatively steady as a percentage o all jobs, but state and local government employment per thousand residents has also remained steady. We analyze the number o public sector employees per thousand residents using Current Employment

14.7% 14.4% 14.5% 15.2%

0%

5%

10%

15%

20%

25%

30%

35%

40%

45%

50%

1979 1985 1991 1997 2003 2009

S h a r e o f s t a t e &

l o c a l g

o v ' t w o r k e r s

Recessions

SourceAuthors'analysisofBLSCurrentEmploymentSta:s:cs.




Statistics rom the Bureau o Labor Statistics and population statistics rom the U.S. Census Bureau.In 1990, the United States as a whole had an average o 17.2 state workers per thousand residents. In2009, there were 16.8. Te number o state and local workers per thousand residents rose slightly overthe entire time period rom 60.8 to 64.2, but remains unchanged since 2001 (Figure 3).

Figure 3 Public sector employment per 1,000 residents has been steady since 1990

Might union states be dierent? New York imes columnist David Brooks argued, “public sector unionscan use political power to increase demand or their product.” ix I he is correct, we should expect states with high public sector union density—the share o public sector workers in a union—to have morepublic sector workers per thousand residents, than states with lower public sector union density. Inorder to test this hypothesis, we examine the ten states with the highest share o public employees inunions and the ten states with the lowest share o public employees in unions. As illustrated in Figure 4,the lowest union density states averaged 69.1 state and local employees per thousand residents in 1990and 74.6 in 2009. Te highest union density states averaged 65.1 state and local employees per thou-sand residents in 1990 and 68.3 in 2009. Te number o state and local employees per thousand actu-ally ell in the high union density states between 2001 and 2009.1

0

10

20

30

40

50

60

70

80

1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

S t a t e a n d L o c a l G o v ' t E m p l o y e e s p e r 1 , 0

0 0 R e s i d e n t s

StateandLocal

State

Source: Population from U.S. Census Bureau; Government employment from BLS Current Employment Statistics.




Figure 4 Public sector employment per 1,000 residents higher in states with least public uniondensity, 1990-2009

Finally, we test whether there was a signicant correlation between the degree o union density in a stateand the number o state and local employees per thousand residents in 2009. Te plot o these data is inFigure 5. Te two variables do not exhibit a dened pattern and there is no statistical correlation be-tween them.2

Figure 5 Higher public union density not correlated with greater public sector employment, by State, 2009

10

20

30

40

50

60

70

80

90

100

19901991199219931994199519961997199819992000200120022003200420052006200720082009

N u m b e r o f S t a t e a n d L o c a l G o v e r n m e n t

E m p l o y e e s P e r 1 , 0


TheTenStatesWithLeastPublic

UnionDensity

TheTenStatesWithMostPublic

UnionDensity

Source:EmploymentdatafromBLS;populaJondatafromU.S.CensusBureau

0.0

20.0

40.0

60.0

80.0

100.0

120.0

140.0

0 10 20 30 40 50 60 70 80

S t a t e a n d L o c

a l E m p l o y e e s P e r 1 , 0


PercentofPublicEmployeesinUnion

Source:EmploymentdatafromBLS;[email protected]




Public sector employment has remained steady, whether measured as a share o the workorce or in rela-tion to state population. No correlation was ound between public sector union density and the levelo public sector employment in a state. Contrary to Brooks’ assertion, there is no evidence that publicsector unionization has resulted in a growth o the public sector workorce.

Public Sector Compensation as a Share of State Budgets has Declined

Not only has the number o public sector workers per thousand residents remained steady, but publicsector compensation as a share o state budget has actually declined. David Madland and Nick Bunkero the Center or American Progress Action Fund analyzed total compensation, including wages, salariesand benets, or public sector workers as a share o state expenditures. Tey created a data set o ex-penditures on state employees between 1992 and 2009. Te period is well timed to cover two completebusiness cycles. Madland and Bunker nd that the share o state spending that went towards compensa-tion ell steadily between 1992 and 2002 and remained stable rom 2002 to 2009 (Figure 6).x

Figure 6 State budget woes not a problem o public sector worker compensation, 1992-2009

Tey urther analyzed the results by the level o public sector unionization. Tey ound that the aver-age share o the budget spent on compensation over the time period or the ten most highly unionizedstates was 19.6 percent, compared to 18.7 percent or the ten least unionized states. By 2009, that gapbetween the two groups had narrowed to 0.5 percent (19.8 versus 19.3 percent). Tey conclude thatstate budget decits were not caused by an increase in unding going to compensation or public sector workers.

0%

5%

10%

15%

20%

25%

30%

1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 G o v e r n m e n t E m p l o y e e S a l a r i e s , W a g e s a n d B e n e f i t s a s S h a r e o f S t a t e E x p e n d i t u r e s

Source: Madland and Bunder 2011. Salary, wage, and expenditure data from U.S. Census Bureau,

" " " "

0%

5%

10%

15%

20%

25%

30%

1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009

G o v e r n m e n t E m p l o y e e S a l a r i e s , W a g e s a n d B e n e fi t s a s

S h a r e o f S t a t e E x p e n d i t u r e s

Source:MadlandandBunder2011.Salary,wageandexpendituredatafromU.S.CensusBureau,StateandLocalGovernmentFinance;

BenefitdatafromBLS,EmployerCostsofEmployeeCompensaOon.




Public Sector Workers are not Overcompensated

In recent years, public ocials have claimed that public sector worker compensation is more generousthan that o private sector workers. Senator Scott Brown o Massachusetts said in 2010, “it’s not rightthat lesser-paid private sector workers suering through a recession have to pay or expensive govern-ment salaries.”xi In his March 2011 budget address, Governor Scott Walker argued that Wisconsin’s eco-

nomic growth was being hindered by a “government that pays its workers unsustainable benets that areout o line with the private sector.”xii New Jersey Governor Christie said “i you were paying attentionthe problems here that are created on the state budget - sure we have a decit problem that was helpedby the economic downturn but what we also have are benets and costs that are out o control.”xiii Tesemisperceptions about compensation inequity have been reinorced by analyses that simply compareaverage compensation o public sector workers to those o private sector workers, without taking intoaccount dierences in stang between the two sectors with regard to education, experience and otherrelevant actors.xiv

However, research has consistently shown that public sector workers are paid the same or less than simi-lar private sector workers when taking into account relevant actors that aect compensation:

• AstudybyJereyKeefeoftheEconomicPolicyInstitute(EPIandRutgersUniversity)analyzed

wage and demographic data rom the Current Population Survey and benets data rom the Em-ployer Costs or Employee Compensation Survey by the Bureau o Labor Statistics. Ater ac-counting or education, experience, hours o work, organizational size, gender, race, ethnicity anddisability,Keefefoundthatfull-timestateandlocalemployeesreceive3.7percentlessintotalcompensation (wages and benets) compared to similar private sector workers.xv

• JohnSchmittoftheCenterforEconomicandPolicyResearch(CEPR)examinedwageanddemo-graphic data rom the Current Population Survey and reported similar ndings: on average, stateand local employees are paid 4 percent less in wages than similar private-sector workers ater adjust-ing or education, age, gender, and other actors.xvi

• SylviaAllegrettooftheUCBerkeleyCenteronWageandEmploymentDynamics(withJereyKeefe)analyzedcompensationinCaliforniaandfoundthat“anapples-to-applescomparison,or

one that controls or education, experience, and other actors that may infuence pay, reveals nosignicant dierence in the level o employee compensation costs on an annual or per hour basisbetween private and public sector workers.” Te study analyzed total compensation, including wages and benets, based on data rom the Current Population Survey and the Employer Costs orEmployee Compensation Survey by the Bureau o Labor Statistics. xvii

Tese are a ew o many examples that illustrate why simply comparing average pay between the twosectors, without taking into account workorce dierences, is highly misleading when, in general, bettereducated and older, more experienced workers earn more than less educated and younger workers.

Journalists Michael Fletcher and Brady Dennis o the Washington Post acknowledged the research dem-onstrating comparable pay, but instead blamed state budget decits on workers’ benets. “Tough stud-ies show that state employees are generally paid less than comparably educated private workers, publicemployees oten enjoy more generous pension and health-care benets, and these are at the root o thelong-term budget problems conronting many states.” xviiiHowever,thestudiesbyKeefeandAllegrettoillustrate that even ater taking benets into account, public sector workers are compensated the same orless than comparable private sector workers.

Not only is compensation comparable or similar private and public sector workers, but private sectoremployment costs have actually increased at a aster rate than those o public sector workers in recentyears. Te Bureau o Labor Statistics measures the average cost to employers or wages, salaries and ben-ets per employee hour worked, published in the Employer Costs or Employee Compensation (ECEC)




series. Our analysis o the ECEC data shows that rom 2004 to 2009 the cost o employing a worker inthe private sector increased 14.7 percent while it increased by 12.6 percent in the public sector.

Budget Woes Due to Bursting of the Housing Bubble and the

Great Recession Not Public Sector Workers and their Unions

As we stated up ront, the recession that ocially lasted rom December 2007 to June 2009 was themost severe downturn since the Great Depression—and the bursting o the housing bubble and the sub-sequent nancial collapse caused it. Regardless, some elected ocials and media have alsely suggestedthat collective bargaining or public sector workers caused state and local budget decits. In a televisioninterview, Governor Scott Walker o Wisconsin said “what stood in the way [o balancing local budgets]time and time again was collective bargaining.”xix David Brooks o the New York imes wrote “states with public sector unions tend to run into scal crises.”xx However, states experienced record decits ata time when public sector unions did not grow and collective bargaining rights were not strengthened. What were the real underlying causes o state decits?

Given that the bursting o the eight trillion dollar housing bubble was the precursor to the Great Reces-sion, it is necessary to assess the role o alling house prices in state budget woes. Using a simple regres-

sion without controls, John Sides ound a small correlation between union density and state budgetdecits.xxi We employ a similar regression analysis to investigate the impact that public sector union den-sity and collective bargaining rights had on the size o state (50 states plus D.C.) decits in FYs 2009and 2010 adding in a number o controls. able 1 presents the regression results.

Following the methodology o Sides, the rst specication simply uses public sector union density as thelone independent or control variable.xxii Te coecient on union density o 0.245 (signicant at the 5percent level) implies that a one-percentage point increase in union density would increase the averagebudget shortall by approximately 0.2 percentage points. In the second specication we add a variableor the change in house prices, by state, over the ve-year period rom 2005-10. Te coecient onunion density becomes much smaller economically (0.114) and is rendered not statistically signicant.Te coecient or eect o a one-percentage point decline in house prices is attributed, on average, to a0.56 percentage point increase a state’s budget shortall. Furthermore, the ‘Adjusted R 2’, which explains

the variation in state budget shortalls, increases rom less than ten percent in the rst regression to overorty percent in the second one.

In the third specication, we add additional controls to capture union strength. Specically, we add aset o dummy, or dichotomous, variables to account or whether state employees, police, re, teachersand local employees are covered under collective bargaining by law, constitution, charter, executive orderor court decision. Another dummy variable indicates whether a state has a right-to-work law. A strikevariable is used i at least one public sector occupation is allowed to strike.xxiii Again, the results show that the coecient on union density is not statistically signicant while the house price eect is approxi-mately the same as in the second specication. We have not listed the coecients o the union strengthvariables because they were all very small (absolute value less than .09) and not statistically signicant.Tus, going beyond union density to account or union strength does not aect the bottom line nd-ing that house price declines were, to a large extent, a central reason why state budgets are in such dire

straits. It should be noted that the outcome o this analysis is not substantially dierent whether changesin state house prices, state GDP or unemployment rate changes by state are used as explanatory vari-ables. Tey are all capturing to a great extent the economic collapse.




Table 1 State budget defcits—a problem o unions or a bursting housing bubble?

o many, this regression analysis may seem like proving the obvious given the state o the economy andthe enormity o the collapse. Tis has nonetheless not stopped the attack on public workers nor theirunions.

Conclusion

Following the 2010 elections, multiple states took action to curtail collective bargaining rights argu-ing that public sector unions were a major cause o state budget decits. A close examination o theavailable evidence nds that the claim that public sector unionization leads to greater decits does not withstand scrutiny.

Te public sector workorce has not been growing relative to the population; this is true in union and

non-union states alike. Tere is no correlation between the share o public workers in unions and thesize o the public sector workorce. Tis belies the notion that public sector unions are increasing thedemand or their product.

Compensation has allen as a share o state expenditures over the last twenty years; this is true or bothhigh and low-union states. Controlling or education, experience and other relevant actors, public sec-tor workers are not more highly paid than their private sector counterparts. Public sector unions pro-vide workers with a voice on the job and enable members to choose their orm o compensation. Tishas generally led to a greater share o compensation paid in health and retirement benets than in cash wages.

Budget decits were primarily caused by the housing crisis and subsequent economic downturn whichresulted in a decline in revenues as the economy contracted. Finally, controlling or the decline in hous-

ing prices, we nd no statistically signicant correlation between union density, union strength and thesize o state budget decits.

For states to address their budget decits, the most important actors are national economic growth anda resolution to the housing crisis. Solutions that ocus on cutting state and local budgets can be expectedto urther weaken the economy. Federal aid to the states is essential to maintain the public inrastructure while the economy rebounds. Federal action is also needed to address the housing crisis, which contin-ues to provide a drag on the economy and on state and local revenues.

Regressionanalysis

Dependentvariable:statebudgetdeficits (1) (2) (3)

Independentcontrols:

Publicsectoruniondensity coeff 0.245 * 0.114 0.167

(se) (0.097) (0.082) (0.14)

Housepricedecline coeff -- -0.561 ** -0.539 **

(se) (0.11) (0.11)

Setofuniondummyvariables+

AdjustedR2

0.096 0.421 0.382

+Seeendnote#3fordetailsofunionvariablethatmeasureunionstrength.

Note:Significancelevels:**1%and*5%.HousingpricedatafromFederalHousingFinanceAgency;

ChangeinFHFAStateHousePriceIndexes,(SeasonallyAdjusted,Purchase-OnlyIndex,2005Q4-2010Q4),

5years.Publicsectoruniondensityin2009fromUnionstats.com.

Specifications

N N Y




Sources

i David Schaper, “Collective Bargaining Curbs Spread Across Te U.S.,” National Public Radio, May 24,2011, http://www.npr.org/2011/05/24/136610879/collective-bargaining-curbs-spread-across-the-u-s .

ii Steven Greenhouse, “Strained States urning to Laws to Curb Labor Unions,” New York imes, Janu-

ary 4, 2011, p. A1, http://www.nytimes.com/2011/01/04/business/04labor.html?pagewanted=all .iii James Sherk, Te National Review Online, “Wisconsin’s Governor Walker takes on Public SectorUnions,” February 15, 2011. http://www.nationalreview.com/corner/259792/wisconsins-governor-walk-er-takes-public-sector-unions-james-sherk .

iv Elizabeth McNichol, Phil Oli, and Nicholas Johnson, Center on Budget and Policy Priorities. “StatesContinue to Feel Recession’s Impact,” June 17, 2011, http://www.cbpp.org/les/9-8-08sp.pd.

v Nicholas Johnson, Phil Oli and Erica Williams, Center on Budget and Policy Priorities, “An Updateon State Budget Cuts: At Least 46 States Have Imposed Cuts Tat Hurt Vulnerable Residents and theEconomy,” February 9, 2011, http://www.cbpp.org/cms/index.cm?a=view&id=1214.

viKenJacobs,LaurelLuciaandT.WilliamLester,“eEconomicConsequencesofProposedCalifornia

Budget Cuts,” UC Berkeley Center or Labor Research and Education Policy Brie, May 2010,http://laborcenter.berkeley.edu/caliorniabudget/budget_impact10.pd.

vii State o Wisconsin Governor Scott Walker, “ext o Governor Walker’s Budget Address,” March 1,2011, http://walker.wi.gov/journal_media_detail.asp?locid=177&prid=5668.

viii U.S. Bureau o Labor Statistics, Current Employment Statistics, 2009.

ix David Brooks, “Te Paralysis o the State,” New York imes, October 12, 2010,http://www.nytimes.com/2010/10/12/opinion/12brooks.html.

x David Madland and Nick Bunker, “State Budget Decits are Not and Employee Compensation Prob-lem: Te Great Recession is to Blame, Center or American Progress Action Fund, March 10, 2011,http://www.americanprogressaction.org/issues/2011/03/pd/statebudgetissuebrie.pd.

xiEdO’Keefe,“ScottBrowntojoinSenatehomelandsecurity,militarycommittees,”WashingtonPost,March 3, 2010,http://www.washingtonpost.com/wp-dyn/content/article/2010/03/02/AR2010030203477.html.

xii State o Wisconsin Governor Scott Walker, “ext o Governor Walker’s Budget Address,” March 1,2011, http://walker.wi.gov/journal_media_detail.asp?locid=177&prid=5668.

xiii ranscript: New Jersey Governor Chris Christie on NBC’s Te oday Show with Ann Curry on Wednesday, February 23, 2011,http://www.state.nj.us/governor/news/news/552011/approved/20110223a.html.

xiv See or example: Dennis Cauchon, “Federal pay ahead o private industry,” USA oday, March 8,

2010, http://www.usatoday.com/news/nation/2010-03-04-ederal-pay_N.htm.xv JereyKeefe,EconomicPolicyInstitute,“DebunkingtheMythoftheOvercompensatedPublicEm -ployee: Te Evidence,” September 15, 2010, http://www.epi.org/page/-/pd/bp276.pd?nocdn=1.

xvi John Schmitt, Center or Economic and Policy Research, “Te Wage Penalty or State and Local Gov-ernment Employees,” May 2010,http://www.cepr.net/documents/publications/wage-penalty-2010-05.pd.

http://www.npr.org/2011/05/24/136610879/collective-bargaining-curbs-spread-across-the-u-s

http://www.nytimes.com/2011/01/04/business/04labor.html?pagewanted=all

http://www.nationalreview.com/corner/259792/wisconsins-governor-walker-takes-public-sector-unions-james-sherk




http://www.nytimes.com/2011/01/04/business/04labor.html?pagewanted=all

http://www.npr.org/2011/05/24/136610879/collective-bargaining-curbs-spread-across-the-u-s




xvii SylviaA.AllegrettoandJereyKeefe,“eTruthAboutPublicSectorWorkersinCalifornia:eyare Neither Overpaid nor Overcompensated,” UC Berkeley Center on Wage and Employment Dynam-ics Policy Brie, October 2010, http://www.irle.berkeley.edu/cwed/wp/2010-03.pd.

xviii Michael A. Fletcher and Brady Dennis, “State budget clashes spread to Indiana, Ohio,” Te Wash-ington Post, February 23, 2010, http://www.washingtonpost.com/wp-dyn/content/article/2011/02/22/

AR2011022205139.html?sid=S2011022302128.xix ranscript o Fox News Sunday, February 20, 2011, http://www.oxnews.com/on-air/ox-news-sun-day/transcript/gov-scott-walker-wisconsin-budget-battle-sens-mccaskill-coburn-capitol-hill-spending-gh.

xx David Brooks, “Make Everybody Hurt,” New York imes, February 22, 2011, p. A25, http://www.nytimes.com/2011/02/22/opinion/22brooks.html?_r=1.

xxi John Sides, “Te Relationship between Union Membership and State Budget Decits,” Te Monkey Cage, February 21, 2011, http://themonkeycage.org/blog/2011/02/21/the_relationship_between_union/.

xxii Barry Hirsch and David Macpherson, Union Membership and Coverage Database rom the CPS,

http://www.unionstats.com/.xxiii Union strength variables based on data rom American Federation o State County and MunicipalEmployees (AFSCME) Department o Research and Collective Bargaining, compiled rom state bar-gaining laws.

Endnotes

1 Te state and national employment numbers are rom two dierent BLS sources; caution should betaken in comparing the data in Figure 3 with the data in Figures 4 and 5.

2 Te union density data is only available or public sector workers as a whole and includes: state, localand ederal workers. Federal workers make up a small raction o public sector workers as a whole.

3 Set o union dummy variables are dichotomus variables dened as ollows:State EE = 1 i state employees are covered under collective bargaining by law, constitution, charter,executive order or court decision (COVERED).Police = 1 i police ocers are COVERED.Fire = 1 i reghters are COVERED.eacher = 1 i teachers are COVERED.Local = 1 i public employees are COVERED.RW = 1 i state has right to work law.Strike = 1 i at least one type o public workers are permitted to strike.

http://www.foxnews.com/on-air/fox-news-sunday/transcript/gov-scott-walker-wisconsin-budget-battle-sens-mccaskill-coburn-capitol-hill-spending-figh









Center on Wage and Employment Dynamics

Institute or Research on Labor and Employment

University o Caliornia, Berkeley

2521 Channing Way #5555

Berkeley, CA 94720-5555(510) 643-8140

http://www.irle.berkeley.edu/cwed

UC Berkeley Center for Labor Research and Education

Institute or Research on Labor and EmploymentUniversity o Caliornia, Berkeley

2521 Channing Way #5555

Berkeley, CA 94720-5555

(510) 642-0323

http://laborcenter.berkeley.edu/

The Wrong Target: Public Sector Unions and State Budget Deficits

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