Bloomberg Law
March 21, 2023, 2:05 PM

ANALYSIS: Union Workers Haven’t Seen Raises Like This in Decades

Robert Combs
Robert Combs
Legal Analyst

Most collective bargaining agreements last three years or longer. So when labor and management negotiators sat down in 2022 to renew their union contracts, it was the first opportunity for many of them to set their workers’ pay rates since 2019.

What happened in between? Only a global pandemic, an economic shutdown, a precipitous recession, a series of layoffs and furloughs, a supply chain crisis, a prolonged recovery, a rise in inflation, a widespread labor shortage, a new appreciation for essential workers, a surge in strike activity, a proliferation of union organizing, a rebound in labor membership, a shift to a more labor-friendly administration, and an overhaul at the NLRB.

That’s a lot to consider when updating a wage scale. But it looks like negotiators were up to the task: Union contracts ratified in 2022 gave workers their highest average pay raise in more than 30 years.

Union contracts signed in 2022 called for an average first-year wage increase of 5.7%, according to Bloomberg Law’s Quarterly Union Wage Data report, which analyzed wage changes in 817 contracts covering more than 1.4 million workers. That’s the highest yearly average since 1990, based on calculations from Bloomberg Law’s wage settlements database.

With signing bonuses and other lump-sum payments added to the calculations, pay hikes rose even higher. First-year raises negotiated in 2022 averaged 6.6% when lump sums were factored in—the largest increase since 1989.

This is a phenomenon that covers the whole of the US labor market. First-year pay increases in 2022 contracts soared to 6.8% for the nonmanufacturing sector, 5.4% for manufacturing, and 4.0% for state and local government.

With lump sums added to the calculations, unions secured an average 7.5% raise in nonmanufacturing contracts, 7.2% in manufacturing, and 4.9% in government.

Can 2022 be dismissed as merely a one-time, post-pandemic spike? The quarterly report does show that there was a slight cooling off in Q4 after six red-hot quarters, so a return to more typical yearly increases of about 3% could be ahead.

But given the current labor market and overall union resurgence, that seems unlikely.

Consider this: Because most contracts for new unions take more than a year to get ratified, odds are that most of the workers unionized in 2022’s election surge haven’t yet had the chance to finalize their pay terms.

And, because first contracts give higher payouts than renewed contracts do, it’s not crazy to expect union pay raises to go even higher, not lower, in the year ahead.

Bloomberg Law subscribers can read the full Quarterly Union Wage Data Report for Q4 2022 here.

Bloomberg Law subscribers can access, search, and run reports from the wage settlements database by using our Labor PLUS: Organizing and Bargaining Data resource.

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