Is the Union Employment Suppression Effect Diminishing? Further Evidence from Canada

This paper examines the impact of unions on employment growth in a longitudinal sample of Canadian workplaces collected during the period 2001-2006. To facilitate comparability with earlier Canadian results, we segment our analysis by industrial sector and establishment size, and find that unions suppress employment growth only in larger manufacturing establishments, and actually seem to promote employment growth among smaller service sector establishments. These results differ substantially from results found twenty-one years previously. We extend previous analysis by examining whether a declining union wage premium may have played a role in these results, and find suggestive evidence for such a contention.