The cost of this wage suppression is real. Because wages make up a large share of income for most U.S. working families, lost wage growth meant sluggish income growth. However, there was one group where wage growth, and corresponding income growth, was substantial: the top 1%, whose wages skyrocketed by 182% since 1979. This uneven growth implies that today’s labor market, and the income derived from it, is deeply unbalanced. Rather than workers reaping the rewards of their rising productivity, a growing share of their labor has gone to the top 1%, leading to rising wage and income inequality.  

Decades of sluggish wage growth for typical workers—paired with the message that it was workers’ own fault for not obtaining the necessary skills for today’s economy—have left many pessimistic about whether policy changes can help them earn more. But if we want to achieve broad-based economic security in the U.S. economy, there is no alternative to raising pay for workers up and down the wage distribution. The U.S. economy generates enough income in aggregate to provide decent rates of pay growth for all workers—the challenge is a political one.

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The cost of inequality to middle-class households

The stakes of rising inequality for middle-income households in the United States are enormous. By 2022, steadily rising inequality was costing these households roughly $30,000 per year.

Figure 1 compares actual income growth of the middle fifth of nonelderly households since 1979 with what this income growth could have been had inequality not increased. The graph highlights market-based incomes because rising inequality was driven entirely by this income category—earnings from the labor market and business income like dividends and interest payments. We focus on incomes of nonelderly households because inequality largely stemmed from unbalanced labor market power, and nonelderly income is dominated by labor earnings.

In 2022, the average market income of the middle fifth of households was $96,335. But their income would have been $127,011—roughly 32% (over $30,000) higher—had inequality not increased after 1979. Put another way, if the middle fifth of households had seen market income grow at the overall average rate—an overall average pulled up by stratospheric growth at the very top—their income could have been roughly $30,000 higher by 2022.

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Income inequality is driven by unbalanced power in labor markets

The inequality in market-based incomes highlighted in Figure 1 was overwhelmingly driven by unbalanced power in labor markets that prevented typical workers from seeing their paychecks keep up with overall economic growth. Figure 2 shows hourly pay (including benefits) for the roughly 80% of the private-sector workforce who are not managers or supervisors and a measure of economy-wide productivity—defined as the income generated in an average hour of work in the U.S. economy. The rising gap between these lines is how we define wage suppression—keeping typical workers’ wage growth slower than growth in incomes in the rest of the economy.

In the three decades following World War II, hourly compensation for the vast majority of workers rose 2.1% on an annualized basis, roughly in line with productivity growth of 2.5%. But for most of the last five decades (except for a brief period in the late 1990s), pay for the vast majority lagged further behind overall productivity. Over the entire 1979 to 2025 period, hourly pay for a typical worker rose just 0.6% while productivity increased 1.4% on an annualized basis. This means that workers have been producing far more than they receive in their paychecks and benefit packages from their employers, and this wedge has grown substantially over time. Some of those gains in productivity went to greater profits for corporations but an even larger portion went to highly paid managers and professionals, resulting in a vast increase in wage inequality over the last five decades.

Had we pursued policies to support broad-based wage growth—instead of wage suppression—typical workers would have much higher pay today. In fact, if annual pay for production and nonsupervisory workers had instead tracked productivity growth since 1979, their pay would be 45% higher, or $30,000 more than it is today.

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Wage suppression boosted profits

The declining labor share of corporate-sector income—the share of corporate income received by workers in the form of wages and benefits—explains a portion of the wedge between productivity and pay. The labor share of corporate-sector income has not recovered to its pre-pandemic level, and remains well below its 1979 to 2008 average. Figure 3 illustrates the labor share of corporate-sector income since 1979. Typically, the labor share rises during recessions because profits fall much faster than wages during downturns. Then, in the early stages of recovery, the labor share falls significantly as profits increase much more rapidly than wages. Usually, the labor share then rises again late in an expansion as labor markets tighten and workers regain the bargaining power necessary to secure wage increases. Since 2000, no business cycle expansion has gone on long enough with unemployment low enough to put serious upward pressure on the labor share of income. Small upticks were seen sporadically over the last 15 years, but this progress, but this progress has stalled out.

Two things about the shift from labor compensation to profits in recent decades deserve some context. First, even as measured in official data, this shift explains well under half of the overall wedge between productivity and pay—the biggest piece of this gap remains inequality within labor compensation (we return to this point further below). Second, some of the changes in the official data might be more the outcome of accounting decisions than of fundamental changes in the economy.

Since the early 2000s, capital income (dividends, capital gains, and business income) has been taxed at lower rates than labor income. Highly privileged economic actors who have the ability to engage in tax evasion by reclassifying their income have likely done so in this time—relabeling income once classified as wages and salaries as capital income instead to pay lower tax rates. Recent research has estimated that roughly a third of the decline in the labor share of income might be driven by this kind of tax evasion rather than by a genuine change in which factors of production are seeing income gains.

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Highly paid corporate managers and professionals benefited the most from wage suppression

The largest portion of the growing wedge between productivity and pay can be explained by the astronomical wage growth for those at the highest end of the wage distribution. The ability of those at the very top to claim an ever-larger share of overall wages is evident in Figure 4. Annual earnings for the top 1% have grown 182% since 1979, while wages of the bottom 90% have grown just 44%. If the wages of the bottom 90% had grown at the average pace over this period—meaning that wages grew equally across the board—then wages for the bottom 90% would have grown by 65%, far higher and roughly 50% faster than the actual growth experienced. Earnings are so concentrated at the top that average growth is well above the 90th percentile of the earnings distribution. That means workers need to be among the highest 10% of wage earners to even experience average earnings growth. And everyone else—more than 90% of the workforce—saw less than average growth over the last four and a half decades.

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Since 1979, middle-wage workers only saw short-lived real wage growth during tightening labor markets

Between 1979 and 2025, the hourly wages of middle-wage workers (workers earning the median wage) cumulatively grew just 30%—about 0.6% per year. Yet even this disappointing cumulative wage growth occurred only because wages grew in the late 1990s and the late 2010s–2020s. Apart from these two periods, the wages of middle-wage workers were totally flat or in decline since 1979. Figure 5 shows real median wages since 1979. The red portions of the line highlight periods when median wage growth was genuinely stagnant, while the green portions highlight when growth occurred.

In the absence of strong institutions and labor standards like robust unions and high minimum wages, strong wage growth occurs only when labor markets are tight. In tight labor markets, the relative scarcity of workers gives them more power in the workplace to effectively demand decent hourly wage growth across the board.

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Wage suppression was not driven by increased benefits

The suppressed “pay” portion of the pay–productivity chart includes wages and benefits, suggesting that benefits have not offset slow wage growth. In fact, by many measures benefit generosity and availability have deteriorated alongside wage suppression. We explore trends in two key employment benefits in Figure 6: employer-sponsored health insurance and retirement coverage. We define employer-provided health insurance as insurance for which the employer pays some or all of the premium. We define retiree coverage as coverage a worker receives at their firm that offers it. We isolate workers who are strongly attached to their job, working at least 20 hours per week and 26 weeks per year.

For workers, sluggish pay has been compounded by the fact that health insurance and retirement coverage have declined significantly over time. Health insurance fell from 69.0% to 52.2% between 1979 and 2024. At the same time, retiree coverage nearly fell by half from 50.6% down to 29.0%. Furthermore, plan generosity has suffered with the trend away from defined benefit to defined contribution retirement benefits, as well as the shift to high deductible health plans.

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CEO pay grabs a larger share of wages

In a nation of increasing inequality, the most extreme disparities are between the heads of large American corporations and typical workers. Figure 7 tracks the ratio of pay of CEOs at the 350 largest public U.S. firms to the pay of typical workers. In 1965, these CEOs made 21 times what typical workers made. As of 2025, they make 325 times typical workers’ pay. This higher pay for CEOs does not reflect any increased contribution to corporate output or growth in the skills or productivity of CEOs. CEO pay gains help explain the growing divergence between pay and productivity. Further, the pay of CEOs and other highly placed corporate managers sets norms and market benchmarks across a range of elite occupations. The pay of specialty physicians, lawyers, consultants, and even sectors like university and nonprofit administration is likely pulled upward by rising pay for corporate executives.

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Tolerating excess unemployment has been deeply damaging for wage growth

As a rough rule of thumb, real wages for middle-wage workers outright fall when unemployment is greater than 5%.

Prioritizing high-pressure labor markets—those identified by extended periods of low unemployment—is key to providing lower- and middle-wage workers the leverage to bid up their wages. Figure 8 shows that the threshold for achieving any real wage growth at all is around 5% unemployment. In general, real wages grow when unemployment is lower than 5%, but they fall when unemployment is higher. Extended periods of low unemployment can also reduce wage inequality and racial disparities.

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The federal minimum wage no longer lifts wages

Figure 9 shows the decline in the real (inflation-adjusted) value of the federal minimum wage since its high in 1968. The last increase to the minimum wage was enacted in 2009, 17 years ago, which is the longest period without a minimum wage increase since its inception in 1938.

The minimum wage is essential for establishing the wage levels for the bottom fifth of wage earners. Today’s low-wage workers are far more educated, older, and experienced than low-wage workers in 1968. Yet, despite being more skilled and productive, their wages are 43% lower than wages earned in 1968, and 32% lower than the most recent increase in the minimum wage 17 years ago. The failure to raise the federal minimum wage has especially adverse effects on women and Black and Hispanic workers.

Luckily, many states have refused to follow the federal government’s inaction and have passed higher minimum wages at an increasing rate over the past two decades. Seventeen states and the District of Columbia now have minimum wages of at least $15 per hour, and more workers live in states with minimum wages over $15 than in states only bound by the too low federal minimum wage.

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The assault on collective bargaining hurts all workers

One of the main causes of wage suppression and rising wage inequality is the decline of collective bargaining, which lowers the wages of both union and nonunion workers. Collective bargaining not only raises wages for organized workers but also leads other employers to raise the wages and benefits of nonunion workers to come closer to union wage standards.

The erosion of collective bargaining can explain from one-fifth to one-third of the growth of wage inequality between 1973 and 2007; it had a greater impact on men than women. This erosion of unionization occurred despite large numbers of workers indicating they would prefer collective bargaining if they had a choice. But the political power of those with the most income, wealth, and power has prevented the adoption of laws to modernize our labor–management system and enable workers to pursue collective bargaining.

Figure 10 shows how wages could have grown if unionization hadn’t declined since 1973. If union density in 2025 had been the same level as union density levels of 1973 (14 percentage points higher than it is today), median wages would rise by 10.1%.

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Click here for the 2015 archive of this page.

The Union-Busting Cost Calculator helps workers estimate how much their employers are spending on union-avoidance consultants, instead of investing that money in their workplaces. Too often employers claim unions are third parties that disrupt workplace dynamics and create costs for workers who are paying for representation they don’t need. On the contrary, unions win wage increases and benefits for workers, and it is employers who spend millions on third-party union-avoidance consultants, rather than raising workers’ wages and improving working conditions. Further, employers often hire the same consulting and law firms to help with their union avoidance. LaborLab’s union-buster search helps demystify who the key actors are in the union-avoidance industry and identify who is behind anti-union campaigns.

If workers understand who their employers are hiring and how much they are spending on union avoidance, this will empower workers in their organizing campaigns. The union-avoidance industry has a devastating impact on workers’ ability to organize in the United States. That is because decades of federal policy and court decisions have weakened federal labor law to the point that employers violate the law with impunity. Union-avoidance consultants and law firms exploit these weaknesses to reach the same goal: to defeat the union. This has caused a significant decline in unionization rates in the United States: Only 1 in 10 workers are represented by a union today, compared with 1 in 3 during the 1950s. It is well documented that the decline in unionization has contributed to increased inequality over the past 45 years.

However, this hasn’t dissuaded workers from organizing. Workers across industries—from graduate students to nurses to baristas—are forming unions and collectively bargaining over improved pay, benefits, and working conditions. In 2025, more than 16.5 million workers were represented by a union, which is the highest level recorded in 16 years.

It should be no surprise that workers are seeking to form unions, even with the odds stacked against them. Unionized workers are more likely to have higher pay, access to employer-sponsored health insurance and retirement, and safer working conditions compared with nonunion workers. Further, the benefits of unions go beyond a single workplace; they also help create stronger communities. Much like unions are a tool to rebalance unequal bargaining power in the labor market, resources like LaborLab’s Union-Busting Cost Calculator and the union-buster search can help even the playing field for workers.

At a time when many are struggling to afford basic necessities, it’s easy to understand why. Through unions and collective bargaining, workers have more power to win higher wages, better benefits, safer working conditions, and a fairer share of the wealth they create. Unions help build a strong middle class, reduce inequality, narrow racial economic disparities, and boost participation in our democracy.

Yet only 1 in 10 U.S. workers are in a union today—a sharp decline from the more than 1 in 3 workers who belonged to a union in the 1950s. That drop did not happen because workers stopped wanting or needing unions. It happened due to relentless attacks on unions and collective bargaining, and lawmakers’ failure to fix the broken labor laws that have allowed those attacks to succeed.

The consequences have been enormous. As union power has declined, workers have seen less of the gains from the economic growth they have helped create. Since 1979, productivity (how much average value workers produce in an hour of work) has grown 2.8 times as much as pay for typical workers.

New EPI research makes clear just how much working people stand to gain by rebuilding union power to 1950s’ levels.

Tripling union membership would raise the pay of the median worker by more than $7,700 a year, or nearly $270,000 over a 35-year career. That’s enough to more than cover the cost of sending two children to a four-year public university, for example. Crucially, both union and nonunion workers would see these gains because stronger unions raise standards across the labor market.

Scaled across the workforce, tripling union membership would shift an estimated $1.2 trillion to the pockets of working people every year. This is enough to reverse roughly one-third of the increase in inequality since 1979.

Stronger unions are also good for businesses and the broader economy. When workers earn more, they have more money to spend in their communities, strengthening consumer demand. Businesses would benefit from lower worker turnover, higher productivity, and workers who have a greater stake in the success of their workplaces.

Tripling union membership won’t be easy, but it’s far from a nostalgic pipe dream. It will take continued nationwide organizing and decisive policy action that makes it easier for workers to unionize. Federal lawmakers can start by passing legislation that expands collective bargaining rights, closes loopholes in existing law that allows employers to suppress worker organizing, and holds employers accountable when they violate workers’ labor rights. Further, state lawmakers should provide all public-sector workers with collective bargaining rights and repeal so-called right-to-work laws that weaken workers’ ability to organize and bargain collectively. 

This Labor Day, let’s recommit to putting more power in the hands of working people. That means giving more workers the freedom to organize. And it means setting an ambitious goal worthy of the moment: tripling union membership and building an economy that works for working people.

Key takeaways:

• So-called right-to-work (RTW) laws undermine workers’ ability to form unions. Unionization rates are clearly lower in RTW states—and since unions raise wages, that suppression lowers pay.   

• States with RTW laws are also more likely to have other anti-worker laws and generally weaker labor standards. This is likely because both RTW and other anti-worker policies stem from the same anti-worker political roots, and because RTW’s suppression of unions deprives these states of strong potential political champions (unions) for other pro-worker policies.  

• Non-RTW states are more likely to have pro-worker policies like higher minimum wages and prevailing wage laws, restrictions on noncompete agreements, pay transparency policies, and more protective unemployment insurance benefits. 

• As a result, workers in RTW states are paid 6.7% less on average than workers in non-RTW states—more than double the 3.2% wage penalty we found in 2015. That means the RTW wage penalty has increased in recent years and now translates to over $4,000 less per year for a median full-time worker in a RTW state.

• The RTW wage penalty is steeper for women (7.3%) than for men (6.3%), and for Black (9.7%) and Hispanic workers (10.0%) than for white workers (5.4%).   

• Lawmakers already have the policy tools they need to boost wages and improve other outcomes for workers: 

• • At the state level, rolling back existing RTW laws is the most powerful lever.  

• • At the federal level, the Protecting the Right to Organize Act (which includes a ban on RTW) would be transformational for efforts to organize workers.  

• • Policymakers could also make progress on numerous other fronts, such as making UI systems more protective and raising minimum wages. 

In the United States, so-called right-to-work (RTW) laws are anti-union state policies promoted by big business interests to weaken unions and limit workers’ bargaining power. Despite the name, RTW laws do not provide any sort of job protection or right to a job. Rather, the deceptively named policy starves unions of resources, making it harder for them to negotiate collectively for better wages, benefits, and working conditions.

RTW laws emerged in the 1940s as part of anti-union campaigns to suppress worker organizing and maintain Jim Crow labor relations in Southern states; these campaigns worsened economic inequality and racial disparities (Childers 2024). Today, 26 states have active “right-to-work” statutes.1

As intended, RTW laws reduce union density (the share of workers who are either members of a union or covered by a union contract). These policies prohibit unions and employers from negotiating over union security—the contract terms under which workers covered by a union contract either join the union or pay an agency fee covering their share of representation costs. This deprives unions of critical resources and suppresses union membership (Sherer et al. 2026). RTW states—specifically those with RTW laws for at least 25 years—have an average union density rate of 6.2%, far less than half the union density rate in non-RTW states (16.0%) (see Appendix Table 1).

RTW laws not only reduce the number of workers with collective bargaining agreements but also limit unions’ political power to advocate for stronger labor standards for workers more broadly. This is, in part, why states without anti-union restrictions are more likely to pass protections such as prevailing wage mandates, restrictions on noncompete agreements, higher minimum wages, and pay transparency laws.

To assess the effects of RTW laws on outcomes for workers, we analyze whether wages are lower in RTW states after controlling for key demographic-, job-, and state-level characteristics (see Appendix Table 1 for full demographic controls as well as median and average wages by RTW status). We find that wages in “right-to-work” states are, on average, 6.7% lower than in non-RTW states. This penalty is worse for Black and Hispanic workers, as well as young workers and those without college degrees. Notably, the penalty is also larger for nonunion workers. This is because strong unions benefit workers across the state, not just those in unionized workplaces (Shierholz et al. 2026). In RTW states with weaker unions, nonunionized workers do not experience these positive “spillover” effects.

Pro-worker policies are more common in states without RTW laws

The strong correlation between wages and states’ RTW status is not surprising. Not only do RTW states have lower unionization rates, leaving workers with less leverage to bid up wages, but they often maintain other anti-worker policies. Combined, these anti-worker policies tilt bargaining power toward employers, weakening workers’ ability to garner higher wages. States without RTW laws are more likely to have a wide array of stronger labor standards in place that raise pay, protect workers’ ability to switch jobs, and support those who lose one. These same states—where unionization rates have not been suppressed by RTW laws—have a better safety net and stronger labor standards in part because stronger unions give workers more political power and the ability to better lobby for pro-worker policies writ large (Shierholz et al. 2026).

Figure A displays the incidence of these labor standards for states with and without anti-union RTW laws.2 This is far from a complete list of relevant policies that may correlate with RTW status and wage levels, but they are illustrative.

Figure A

Prevailing wage

Prevailing wage laws apply to certain contracts for public works and require that contractors and subcontractors pay the employees performing such work a prevailing wage rate. The prevailing wage rate is defined as the average wage paid to similarly employed workers in a specific occupation in the area of intended employment. Federal law requires this of federal contracts while state and local laws may apply to state and local contracts.

Prevailing wage laws are more common in non-RTW states. Figure A shows that nearly all (96.0%) of non-RTW states have prevailing wage laws, while only 23.1% of RTW states have these protections for workers on state contracts.3 Without prevailing wage requirements, contractors may reduce their workers’ wages to win bids on government contracts—putting contractors who pay their workers fair wages at a disadvantage.

Restrictions on noncompetes

Noncompete agreements are employment provisions that ban workers at a company from joining a competing business or starting their own for a set period after leaving a job. Noncompetes undermine economic dynamism and innovation; they depress business formation and labor mobility, hurt productivity and growth, raise prices, shrink workers’ wages, and restrict workers’ freedom (Shierholz 2024).

One of the most effective ways workers achieve higher wages is by securing another offer, and then either renegotiating their current salary or leaving for the new higher-paying job. It is not surprising then that workers in states that enforce noncompetes are paid less than similar workers in states that do not enforce noncompetes (Starr 2019). States without anti-worker RTW laws are nearly four times as likely to restrict noncompetes as RTW states (44.0% vs. 11.5%).4 In this analysis, we include only full bans on noncompetes and states with income-based restrictions. States with only small carve-outs for certain occupations provide a much weaker standard and are, by definition, less broad, so those aren’t included.

Minimum wage

Raising the minimum wage is particularly important for lower-wage workers. While the federal minimum wage has sat at $7.25 an hour since 2009, losing over 30% of its purchasing power, workers in 31 states enjoy a higher wage floor (Zipperer 2026). Non-RTW states are three times as likely to have minimum wages higher than the federal minimum compared with RTW states (92.0% vs. 30.8%). This is not a small difference. As of 2026, the average value of the minimum wage in non-RTW states is 60% higher—$5.36 more per hour—than in RTW states.5

Pay transparency

Pay transparency laws prevent employers from lowballing wage offers by requiring them to include wage information in job postings. While they vary, all laws include some requirement that employers provide salary information in job postings or if directly requested by applicants. Lack of knowledge about wages and benefits keeps potential workers in the dark and limits their ability to learn about and apply for better paid opportunities. A study on Colorado’s newly passed wage transparency law found that wages increased 4.2% faster than those in neighboring states without such laws (Shedge 2025). Further, wage transparency has the potential to reduce gender- and race-based discrimination by arming jobseekers with more information and limiting employers’ ability to pay different amounts to similarly qualified candidates. Only two RTW states have a pay transparency law, compared with 64% of non-RTW states.6

Unemployment insurance

Access to unemployment insurance (UI) also shapes workers’ ability to seek better wages. When a worker is laid off and their household income falls, unemployment insurance supports them and their family until they find another job. UI is a joint federal-state program that relies on state UI systems to effectively deliver benefits to unemployed workers. States differ in their rules and approaches under the federal UI framework, leading to wide variation in the share of unemployed workers receiving UI benefits (the UI recipiency rate).

Better UI not only cushions workers and their families but also provides workers with additional leverage in the labor market. When UI access and generosity fall, job seekers are forced to settle for lower wages and employers leverage this by offering less (Dahl and Knepper 2026). On the flip side, research shows a positive relationship between more UI generosity and wages (Rinz and Wasser 2026). The UI recipiency rate is significantly higher in non-RTW states compared with RTW states (32.8% vs. 18.7%).7 This is not surprising because non-RTW states have stronger unions, which fight to increase UI eligibility, ease of access, benefit levels, and benefit duration—to the benefit of all workers, union and nonunion (Hertel-Fernandez and Gould-Werth 2020). As with other pro-worker policies, better UI access can contribute to higher wages in non-RTW states.

Other policy levers

Not only do workers in non-RTW states enjoy higher wages, but they also benefit from increased economic security thanks to higher health insurance rates, higher public education spending, paid family and medical leave access, and no preemptions against higher labor standards. Every non-RTW state expanded Medicaid compared with fewer than two-thirds of RTW states (61.5%).8 Unsurprisingly, the uninsured rate is higher in RTW states than in non-RTW states (8.9% vs. 6.2%).9

Investments in public education deliver a more productive workforce and more informed and engaged society. Increased funding for schools not only improves educational attainment, but also increases wages and family incomes (Jackson, Johnson, and Persico 2016). Non-RTW states spend 45% more on public education than RTW states ($24,084 vs. $16,620).10 Paid family and medical leave provides essential benefits that help workers maintain their livelihoods while taking care of themselves and their families. These laws are also shown to increase labor force participation, job retention, and earnings (Glynn 2020). Only one RTW state has comprehensive paid family and medical leave provisions for private-sector workers, compared with 56% of non-RTW states.11

Finally, some cities, counties, and other local governments enact policies that raise standards for working people, but some state legislatures force those standards back down with preemption—the use of state law to void local ordinances. Preemptions apply to policies such as minimum wage, prevailing wages, paid leave, and fair scheduling (EPI 2025). Preemption laws interfere with local governments’ ability to set job quality standards. They suppress wages, exacerbate racial inequities, and reduce worker power (Sherer, Cohn, and Ahdoot 2025). These preemptions are more common in RTW states.

Workers in RTW states are paid less

Our analysis of the relationship between wages and RTW status puts states into three categories: long-term RTW states, always non-RTW states, and “switcher” states that have changed their RTW status since 2011.12 Appendix Table 1 provides descriptive statistics for these three groups of states, and Appendix Figure A provides a map of states by RTW status. Our estimates focus on comparisons between long-term RTW states and always non-RTW states.

A simple comparison of hourly wages, the primary variable of interest, reveals that average wages are 22.9% higher in non-RTW states ($40.28 in non-RTW states vs. $32.78 in RTW states). Median wages are 19.2% higher in non-RTW states ($28.79 vs. $24.16). Because there are differences between worker-, job-, and state-level characteristics in RTW and non-RTW states, and since some of these characteristics will directly impact workers’ wages, it is important to control for these factors in a multivariate regression model. This allows us to more accurately identify the relationship between RTW status and wages.

We estimate log wage equations using Bureau of Labor Statistics Current Population Survey Outgoing Rotation Group (CPS-ORG) data for 2023–2025. We pool three years of data to minimize any spurious year-specific economic relationships, thereby helping us achieve more precise estimates. The total sample consists of 234,155 workers, ages 16+, who earn wages and salaries. About 42% of the sample lives in states with RTW laws (see Appendix Table 1 for the sample’s full demographic breakdown).13

In Table 1, we construct a regression model, starting with an unadjusted framework and building up to a model that controls for the full range of explanatory variables. The dependent variable is the natural log of hourly wages.

The variable of interest is an indicator variable when the worker lives in a long-term RTW state. We also include an indicator in the regression for a switcher state, though that is not our focus of interest (see Appendix Table 2 for a complete set of regression results, including the coefficient for switcher states). There are currently 26 states with RTW laws on the books and 25 without them including Washington, D.C. (see Appendix Figure A). There are five switcher states that have adopted RTW in recent years: Indiana (2012), Michigan (2013), Wisconsin (2015), West Virginia (2016), and Kentucky (2017). In 2023, Michigan became the first state to repeal its RTW statute. We separate the five switcher states from the analysis to better isolate the relationship between wages and the long-run effects of RTW.

The naïve model, without any controls, suggests that workers in RTW states are paid 17.8% less than workers in non-RTW states (Model I in Table 1).14 But many factors contribute to wage differences: demographic characteristics such as age, race/ethnicity, gender, and level of education are relevant as well as job-related factors such as work hours, occupation, and industry. Since these vary across states, they reduce the measured relationship between RTW status and wages. Model II shows that when the analysis compares more similar workers with each other, the RTW penalty drops to 14.0%.15

There are other factors that are different in RTW states, aside from these individual and job-related characteristics. Most importantly, the cost of living. The cost of living in non-RTW states is higher than in RTW states, as shown in Appendix Table 1. In prior research, Gould and Kimball (2015) showed that choice of price indicator makes no material difference on the measured relationship between RTW and wages. Here we include the Bureau of Economic Analysis’ Regional Price Parity index: The regional price parity index is higher in non-RTW states.16 Not surprisingly, this correlates with wage levels and therefore is important to include in the model. As with earlier studies, we also include state unemployment rates to control for differences in economic conditions.

After including the full set of demographic, individual-, and state-level labor market and cost of living controls (Model III), our analysis finds that workers in RTW states are paid 6.7% less than similar workers in non-RTW states. For the average worker, this is a difference of $2.70 per hour, or more than $5,600 for full-time workers at 2,080 hours over the year. However, because the average is skewed upward due to wage inequality, an assessment at the middle of the wage distribution provides a more conservative but perhaps more robust estimate of the RTW wage penalty. Acknowledging that this is a likely understatement of the full relationship, the RTW wage penalty for the median worker at full-time hours is over $4,000 for the year.

Table 1

This does not mean that RTW laws are a causal explanation for this 6.7% wage penalty. As demonstrated earlier in this report, RTW status correlates strongly with a number of other anti-worker policies. Other research has attempted to calculate the causal effects of RTW laws on wages. Using the switcher states in the most recent period, Fortin, Lemieux, and Lloyd (2022) found smaller wage penalties, which is to be expected given the shorter time frame for measurement post-adoption. Our wage penalty for switcher states—shown in the final column of Appendix Table 2—is much smaller (closer to zero) than the coefficient for long-term RTW states, though not statistically significant at conventional levels. Dasgupta and Merchant (2023) also examine states recently adopting RTW laws and find a statistically significant decline in annual wages by almost $1,900. Again, these states are more recent RTW adopters, so the full effects we find may take time to materialize.

We find that this relationship between long-term RTW status and wages remains economically and statistically significant under alternative specifications of our econometric model. For instance, removing major industries and occupations changes the coefficient to -0.071. Restricting the model to RTW status as of 2026—removing the separate indicator for states that switched since 2011—yields a coefficient estimate of -0.060. Doing the same but dropping Michigan (since its status changed in the measurement period) results in a coefficient of -0.064. In our final model, we do not include an indicator for unionization, unlike Gould and Kimball (2015). If we reintroduce that variable, the coefficient is -0.063.

In each of our regressions discussed above, we include a three-year average as it improves data reliability and allows us to run smaller groups of the data (see next section). When we run our analysis using just 2025, our results do not change. In fact, when we run our three-year final model for the periods 2021–2023, 2022–2024, and 2023–2025, our coefficients remain in the -0.070 to -0.068 range.

Wage penalties are steeper for women, Black, Hispanic, and nonunion workers in RTW states

The RTW penalty is not uniform across demographic groups and other labor market characteristics. Table 2 below shows the results of a series of final-model regressions (comparable to Model III in Table 1) for a set of demographic groups.

We find that women’s wages in RTW states are penalized at a higher rate (7.3%) than men’s (6.3%). The wage penalty also persists across all racial and ethnic groups, but it is almost twice as large for Black (9.7%) and Hispanic (10.0%) workers as for similar white workers (5.4%) and more than twice as large as for Asian American and Pacific Islander (AAPI) workers (4.6%). Young workers between the ages of 16 and 24 face a greater penalty (8.4%) than older workers. And workers without a college degree experience a much higher penalty (7.8%) than workers with a college degree (4.7%).

Table 2

It is particularly important to note that RTW laws have a statistically significant negative effect on the wages of nonunion workers, as shown in the last row of Table 2. Our analysis indicates that nonunion workers in RTW states have wages that are 6.3% lower, on average, than their counterparts in non-RTW states. Union members likely experience a smaller penalty (3.6%) because their wages tend to be higher than those in nonunionized workplaces, regardless of the state’s RTW status (McNicholas et al. 2025). However, the wage impact of unions extends beyond those directly covered by a union contract. Unions lift wage standards across entire industries, meaning that nonunion workers in states with higher union density are more likely to receive better pay.

As the gap in wages and labor standards between RTW and non-RTW states has grown, so has the wage penalty

Using our final model (Model III in Table 1) with pooled 2023–2025 data, we find a 6.7% RTW wage penalty—a larger penalty than we found in earlier examinations. For example, we found a 3.2% wage penalty using data for 2009 (Gould and Shierholz 2011) and pooled 2010–2012 data (Gould and Kimball 2015). Some of the increase in the current estimate of the RTW wage penalty reflects small changes (likely improvements) in our methods. But part of the higher estimate persists even when we apply our current methods to earlier data: Applying these methods to the 2010–2012 data yields an RTW wage penalty of 4.7%.

One method change concerns “switchers”—states that changed from non-RTW to RTW status (or back) since 2019. In the 2010–2012 period, there were no switchers to affect the data.17 In our analysis, we isolate switchers from the long-term RTW group, but the RTW penalty remains negative and significant no matter how one deals with the issue of switcher states. For example, recategorizing the five switchers to match their 2012 status (all non-RTW) lowers the measured RTW wage penalty in the 2010–2012 period to 4.1%, but it remains significant.

Other changes relative to our earlier research include controlling for public-sector status; removing union as an independent variable from the regression; using the full working age range of 16 and up (as opposed to 18–64); and correcting an issue with nonrandom missing values to the metropolitan variable. We’ve further clustered standard errors at the state level as suggested by Douglas (2024), which does not affect the size of the coefficients, only the size of their standard errors and resulting statistical significance.18

Setting those minor model differences aside, a consistent comparison over time sees the RTW wage penalty rising from 4.7% in 2010–2012 to 6.7% in 2023–2025. One possible reason why this RTW wage penalty grew could be the increasingly divergent policy trajectories of RTW and non-RTW states over this period.

For example, the gap between minimum wages in RTW states and non-RTW states has grown since 2010, largely because policymakers in most RTW states have refused to increase their minimum wage despite the fact that the federal minimum wage has been stagnant in nominal terms since 2009. In that year, the average minimum wage in RTW states was $7.25 while the average minimum wage in non-RTW states was $7.54. That gap has grown enormously, from just $0.29 per hour in 2009 to $5.36 per hour by 2026 ($14.24 in non-RTW states vs. $8.89 in RTW states).

There were other potentially relevant policy changes between 2012 and 2025. The first state-level pay transparency law was passed in Maryland in 2020. Seventeen states followed suit in subsequent years, 15 of which were non-RTW states. On the flip side, six states have repealed their prevailing wage laws since 2012—all of which were RTW. Only one state, Michigan, reinstated its prevailing wage law. It did so in 2023, the same year it repealed RTW. While this is far from an exhaustive list, it’s not surprising that the measured RTW wage penalty has grown over time.

Repealing anti-union “right-to-work” laws and strengthening labor law is key to raising wages

The wage penalty for workers in RTW states has grown since the last time we conducted this research a decade ago. Long-standing and more recently enacted anti-union RTW laws in 26 states, in tandem with other anti-worker policies, have further eroded workers’ collective bargaining power, suppressed wages, and lowered labor standards. These outcomes are linked to clear policy choices, and lawmakers at every level of government have the tools they need to restore workers’ union rights, strengthen labor standards, and lift wages. Across the U.S., 56 million workers say they want a union in their workplace, yet only 10% of all workers have one (Shierholz et al. 2026). Current federal and state labor laws—including anti-union RTW laws—place too many obstacles in workers’ path to unionizing and give employers too much power to interfere with workers’ free choice.

First and foremost, states with RTW laws should follow Michigan’s recent lead and repeal them. Repealing state RTW laws will enable workers to unionize and raise wages across the country. Indeed, recent EPI research finds that equalizing collective bargaining rights across all states by repealing RTW laws that affect private employees and ensuring collective bargaining rights for public employees would increase national union density by almost 50% (from 9.9 to 14.4%) (Shierholz et al. 2026). States should also consider passing constitutional amendments that affirm collective bargaining rights and explicitly bar RTW-style restrictions, such as the 2022 Workers’ Rights Amendment in Illinois (Sherer 2026).

At the federal level, lawmakers should pass the Protecting the Right to Organize (PRO) Act. The PRO Act is designed to address major weaknesses of the National Labor Relations Act (NLRA), which has been severely eroded by amendments and court decisions. Among many other reforms, the PRO Act would eliminate the option for states to maintain anti-union RTW laws—restoring full bargaining rights to workers in all states as intended when the NLRA was originally passed in 1935 (McNicholas, Poydock, and Rhinehart 2021). Since its first introduction in 2019, the PRO Act has passed the House of Representatives twice with bipartisan support (Shierholz et al. 2026).

In addition to proposed PRO Act reforms that would enable newly unionized workers to pursue arbitration to achieve a first contract (if an employer fails to negotiate in good faith), federal labor law should set a minimum standard that such contracts include a cost-of-living adjustment (COLA). To further expand the benefits of collective bargaining, Congress should amend the NLRA to require default collective bargaining at any firm where CEO-to-worker pay ratios exceed 100 times what a typical worker makes in their industry (as this ratio would be one proxy for whether conditions at an employer are particularly unequal) (Shierholz et al. 2026). 

Legislators at both the state and federal level should also look to the list of anti-worker laws that are typically found in RTW states for more opportunities to rebalance unequal power in the labor market and improve wages and working conditions. These policies include:

• Raising the minimum wage;
• Banning noncompete agreements;
• Strengthening federal unemployment insurance guidelines and state UI systems;
• Removing state restrictions that preempt local governments from raising wages and strengthening labor standards.

These are among just a few of the policy levers states can use to raise wages and standards (EPI 2026b).

Our analysis suggests that repealing anti-union RTW laws and enabling workers to increase unionization levels are key to raising wages, both because RTW laws directly suppress unionization rates (and unions raise wages), and because weakening unions limits workers’ collective ability to shape other public policies.

Acknowledgements

The authors are grateful to Josh Bivens, Jennifer Sherer, Hilary Wething, and Ben Zipperer for their helpful comments and expertise.

Appendix

Appendix Figure A

Appendix Table 1

Appendix Table 2

Notes

1. See Appendix Figure A for RTW status. As of 2026, these states are Alabama, Arizona, Arkansas, Florida, Georgia, Iowa, Idaho, Indiana, Kansas, Kentucky, Louisiana, Mississippi, North Carolina, North Dakota, Nebraska, Nevada, Oklahoma, South Carolina, South Dakota, Tennessee, Texas, Utah, Virginia, Wisconsin, West Virginia, and Wyoming.

2. States are categorized as “RTW” or “non-RTW” based on their status as of 2026.

3. Authors’ analysis of prevailing wage laws from DOL (2023) and state legislative websites.

4. Authors’ analysis of noncompete restriction policies from EIG (2026).

5. Authors’ analysis of minimum wage data from EPI (2026c).

6. Authors’ analysis of pay transparency laws from GovDocs (2026).

7. Authors’ analysis of UI recipiency rate data from DOL-ETA.

8. Authors’ analysis of Medicaid expansion policies from KFF (2026).

9. Authors’ analysis of uninsurance rates by state, 2023 through 2025, from Carter (2025).

10. Authors’ analysis of per-pupil education spending data from NCES-NPEFS (2024).

11. Authors’ analysis of paid family and medical leave policies from Wielk (2026).

12. Prior to 2012, the last state to change its status was Oklahoma in 2001.

13. This analysis builds on earlier work by Gould and Kimball (2015); see the report for a full description of the methodology and list of controls.

14. Interpreting the results from these semilogarithmic functions requires utilizing the exponential function on the coefficient. Specific to the binary variable coefficient (β1) for RTW, the percent change in workers’ wages resulting from a state being RTW can be calculated by the formula: 100*[exp(β1)-1]. Typically, the result of this equation will be very close to the coefficient itself but will differ more as the coefficient becomes larger. We show the coefficient in the first row of Table 1 and the exponentiated result as a percent in the third row.

15. Full regression results for covariates in all three models can be found in Appendix Table 2.

16. Because the 2025 BEA RPP data were not yet available at the time of publication, we assign an average of 2022–2024 data to all years in our sample (2023–2025).

17. Gould and Kimball (2015) classify Indiana as non-RTW as its RTW law had just taken effect.

18. We do not control for state-level fixed effects, as Douglas (2024) suggested, because state-level fixed effects perfectly correlate with RTW status and would deem our results uninterpretable.

References

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Carter, Caitlin. 2025. “Health Insurance Coverage by State: 2023 and 2024.” U.S. Census Bureau, September 11, 2025. 

Childers, Chandra. 2024. The Evolution of the Southern Economic Development Strategy: Rooted in Racism and Economic Exploitation: Part One. Economic Policy Institute, May 2024. 

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Key takeaways

• The label “right to work” is intentionally misleading. RTW laws provide no job protections. What they do is make it harder for workers to form and sustain strong unions.
• RTW laws are intended to weaken unions. They are linked to lower unionization rates, lower wages and benefits, and worse safety outcomes for all workers.
• RTW laws have racist, anti-union origins dating to the 1940s. For decades, big business and white supremacist groups promoted RTW laws to diminish workers’ collective bargaining rights and block multiracial organizing.
• RTW laws don’t boost job growth but do erode job quality and increase inequality.
• Trends on RTW are reversing. No state has adopted a new RTW law since 2017, and multiple states have repealed or rejected RTW.

Raymond Windmiller, Executive Officer
Executive Secretariat
U.S. Equal Employment Opportunity Commission
131 M Street, NE
Washington, DC 20507

Re: Proposed Rule for Removal of Reporting Requirements (RIN 3046-AB37)

Dear Commissioners,

I write to submit this comment on behalf of the Economic Policy Institute (EPI), responding to the Equal Employment Opportunity Commission’s proposed rule to rescind and remove the requirements for filing the EEO-1, EEO-2, EEO-3, EEO-4, EEO-5, and EEO-6 reports1, and the recordkeeping and record preservation requirements related to these reports, under 29 CFR part 1602.

EPI is a nonprofit, nonpartisan think tank created in 1986 to include the needs of low- and middle-income workers in economic policy discussions. EPI conducts research and analysis on the economic status of working America, proposes public policies that protect and improve the economic conditions of low- and middle-income workers, and assesses policies with respect to how well they further those goals. For 18 years, EPI’s Program on Race, Ethnicity and the Economy (PREE) has been a nationally recognized source for expert analysis of the many ways that race, ethnicity, gender, class and policy decisions intersect to affect economic outcomes.

We strongly oppose the EEOC’s proposal to rescind the EEO reporting, recordkeeping and record preservation requirements. If implemented, this rule would undermine the Commission’s capacity to enforce federal laws against employment discrimination. Furthermore, this rule would deprive employers, researchers, policymakers and advocates of their ability to independently analyze and use this unique data source to develop and advocate for policies that support the EEOC’s mission of ending workplace discrimination.

The U.S. Equal Employment Opportunity Commission (EEOC) is a cornerstone in upholding the civil rights of U.S. workers. Established under the same law that officially prohibited employment discrimination (Title VII of the Civil Rights Act of 1964), the EEOC embodies the fact that effective federal laws against employment discrimination require consistent enforcement. For the last 60 years, EEO reports have been central to the agency’s capacity to enforce the law and to monitor and track the nation’s progress toward ending workplace discrimination.

That goal is still a work in progress, as documented in an extensive body of methodologically rigorous research by economists, sociologists and other social scientists. In what follows, we explain why the Commission’s proposal to rescind all EEO data collection would be counterproductive to reaching that goal and detrimental to the U.S. economy by:

• Summarizing the research on labor market discrimination that justifies the ongoing need for EEO reporting requirements;
• Describing how broad EEO reporting requirements help to rebalance power and information asymmetries between employers and employees; and
• Presenting estimates of how much discrimination costs the U.S. economy in economic output and average living standards.

Research and national data provide compelling evidence of persistent labor market discrimination against “minorities”

In their proposed rule, the Commission claims that EEO Reports “may encourage employers to discriminate against employees who are not considered ‘minorities,’ may promote racial stereotyping, and may encourage employers to engage in discrimination to avoid potential EEOC enforcement actions or to address perceived inequitable outcomes.” In addition to this being highly speculative, it is also inconsistent with what we know from research and national statistics. Large and persistent disparities in employment and pay of Black workers relative to white workers are among the most durable features of the U.S. labor market. Compelling empirical evidence points to discrimination as a significant factor in the persistence of those disparities.

EPI’s detailed expert analysis of Bureau of Labor Statistics (BLS) data shows that the significant racial disparities in unemployment that are observed at each level of education, across age cohorts, and among both men and women strongly suggest that education or skills differentials alone can’t account for the near constant 2-to-1 Black-white unemployment gap2.

These findings are consistent with field experiments revealing that Black job applicants with equivalent, and sometimes superior, credentials to white applicants are less likely to receive job callbacks3. One of the starkest audit study findings in this regard concludes that employers treated white applicants with criminal records more favorably than Black applicants without criminal records4. Researchers also found that when résumés of Black and Asian job applicants were stripped of clues of their racial identity, they received callbacks at a much higher rate than those that clearly indicated an applicant’s racial identity5.

While audit and correspondence studies have been criticized for not adequately capturing unobserved characteristics that might influence hiring decisions, newer studies have shown how robust these findings can be to such considerations6. In fact, subsequent field experiments reveal a pattern of hiring discrimination experienced by Black and Hispanic job seekers that remained remarkably constant over time, with white applicants receiving 36% more callbacks than Black applicants and 24% more callbacks than Hispanic applicants7.

EPI’s analysis has also shown that since 1979, less than half of the observed black-white difference in average hourly wages can be explained by differences in education, experience, or region—the main factors presumed to determine pay – and discrimination has consistently played a major role8. However, changes in this racial wage gap track closely with changes in policy, including civil rights enforcement, and with structural factors that affect wage inequality. According to trend analysis research, the narrowing of the gap from the late 1960s through the 1970s can be attributed to the passage of important civil rights legislation9, combined with the 1960s economic boom, active enforcement of anti-discrimination10 and affirmative action policy11, and the narrowing of the educational attainment gap between Black and white workers12. On the other hand, retrenchment on anti-discrimination policy was found to be a significant factor in the widening of the gap during the 1980s13. Since 2000, research has shown a troubling trend of larger discriminatory differentials among the more highly educated14.

Contrary to the Commission’s proposed justification for ending EEO reporting requirements, the research literature cited above offers no evidence of systemic discrimination “against employees who are not considered minorities”. The research, however, underscores the need for ongoing monitoring of employment and pay discrimination through the collection of EEO data.

Elimination of EEO data would worsen power and information asymmetries that undermine worker protections

In an essay published under EPI’s Unequal Power project, former EEOC Chair Jenny Yang explains that “in a system that places the primary responsibility for enforcing anti-discrimination laws on individual workers, who must file complaints with their employer or a government agency, the government plays a fundamental role in rebalancing the power disparities between workers and employers.”15 She further concludes that “policies that encourage employer transparency and require data collection to support prevention and accountability are essential to addressing the inherent information asymmetry workers face.”16

EEO data helps to provide the necessary transparency and accountability across major segments of the U.S. labor market, including private employers with 100 or more employees and federal contractors with 50 or more employees (EEO-1), apprenticeship programs (EEO-2), labor unions (EEO-3), state and local governments (EEO-4), elementary and secondary schools (EEO-5) and institutions of higher education (EEO-6)17.

While the Commission now argues that reporting requirements are too broad because they include non-discriminating employers along with those accused of discrimination, that feature is actually a strength of EEO data. As the nation’s only federally collected source of firm-level information on employment by race, ethnicity, sex, and job category, the EEO-1 provides EEOC investigators with the information they need to assess each individual claim within the context of a larger group of employers.

In addition to being used in this important first step of the charge intake process, these data can also identify potential patterns of systemic discrimination within an industry, occupation, or worksite location. This information helps to direct EEOC systemic enforcement and commissioner’s charges, enabling the EEOC to investigate and address discriminatory practices in cases where workers either lack information or fear retaliation for filing an individual charge of discrimination. Many state and local government Fair Employment Practices Agencies (FEPAs) also have data sharing agreements with EEOC, allowing them to utilize EEO data for local enforcement activities. Similar data collections are too costly for most FEPAs to undertake on their own. As such, EEO data address information and power asymmetries that make it difficult and costly for workers to identify and prove discrimination.

Elimination of EEO data would limit EEOC’s ability to support economic growth through reduced discrimination

Finally, the Commission claims that elimination of the EEO surveys is consistent with the policy underlying E.O. 14192, “Unleashing Prosperity Through Deregulation,” requiring agencies to be “prudent and financially responsible in the expenditure of funds . . . to alleviate unnecessary regulatory burdens placed on the American people.” However, the Commission is overlooking the cost discrimination imposes on the economy and the long-term consequences ending EEO data collection would have on the EEOC’s ability to reduce discrimination through the enforcement mechanisms described above.

Research shows that since the 1960s, the decline in workplace discrimination has contributed to a stronger economy and more inclusive labor force. A widely cited 2019 report concludes that reduced discrimination alone accounted for almost 8% of GDP per capita growth between 1960 and 201018. Extrapolating this estimate through 2024 and applying it to published national estimates of real GDP per capita, we estimate that reduced discrimination boosted average living standards by $4,932 per person since 196019. While it is difficult to precisely measure the EEOC’s impact apart from other forces, assuming the Commission’s role in reducing discrimination accounts for 10–25% of that growth, we estimate that EEOC enforcement, aided by EEO data, helped to boost average living standards by $493 to $1,233 per person since 1960. This estimated increase in average living standards applies to all people, not just those with proven claims of discrimination. Elimination of EEO data would compromise many of the EEOC’s tools for enforcing laws against employment discrimination, and as a result, undermine economic growth.

Conclusion

For years, the EEOC has been vastly under-resourced relative to the magnitude of its enforcement responsibilities, and EEO data is essential to directing those limited resources. Changes to the categories and definitions used in EEO forms over time represent the ways in which Commissioners have grappled with how to accurately capture individual markers of identity useful in detecting unfair influence over employment opportunities for members of legally protected classes.

Under prior administrations, EEOC has convened expert panels to evaluate EEO data collections. These panels were comprised of statisticians, economists, sociologists, legal scholars, and other practitioners with decades of expertise in statistical analysis, labor and civil rights law and the study of labor market discrimination. I have had the privilege of serving on two of these panels. In both instances, panel members expressed differing opinions with respect to data quality, what conclusions could be reliably drawn from the data, and how to best improve the data collection process. Undoubtedly, there were also likely differences in panel members’ political views, but I don’t ever recall any assertion that the problem discrimination had been sufficiently reduced to justify removal of EEO reporting requirements.

In conclusion, EPI strongly urges the Commission to withdraw its proposal to eliminate all six of the EEO surveys. Failure to do so would renege on the promise of our nation’s anti-discrimination laws for workers, their families and the economy.

Sincerely,

Valerie Wilson, PhD
Director, Program on Race, Ethnicity and the Economy
Economic Policy Institute

1. The EEO-2 remains authorized under Title VII of the Civil Rights Act of 1964 but has not been collected since 1981. In this case, our recommendation to continue the surveys is a recommendation to reinstate it.

 The EEO-6 remains authorized under Title VII but has not been collected since 1993. In this case, our recommendation to continue the surveys is a recommendation to retain this authorization and reinstate the survey to the extent that it is not superseded by the Integrated Postsecondary Education Data System (IPEDS) Staff Survey of the U.S. Department of Education.

2. Valerie Wilson and William Darity Jr., Understanding black-white disparities in labor market outcomes requires models that account for persistent discrimination and unequal bargaining power, Economic Policy Institute, March 2022.

3. Examples include: Michael Fix, George C. Galster, and Raymond J. Struyk, “An Overview of Auditing for Discrimination.” in Michael Fix and Raymond Struyk, eds., Clear and Convincing Evidence: Measurement of Discrimination in America, Urban Institute Press, 1993; Marc Bendick, Jr., Charles W. Jackson, and Victor Reinoso, “Measuring Employment Discrimination Through Controlled Experiments” in James B. Stewart, ed., African-Americans and Post-Industrial Labor Markets, Transaction Publishers, 1994; Michael Fix, George C. Galster, and Raymond J. Struyk, “An Overview of Auditing for Discrimination” in Michael Fix and Raymond Struyk, eds., Clear and Convincing Evidence: Measurement of Discrimination in America. Urban Institute Press, 1993; and Margery Turner, Michael Fix, and Raymond Struyk, Opportunities Denied, Opportunities Diminished: Racial Discrimination in Hiring, Urban Institute Press, 1991.

4. Devah Pager, “The Mark of a Criminal Record,” American Journal of Sociology 108 (March 2003): 937–75.

5. Sonia Kang, Katy DeCellesa, András Tilcsika, and Sora Jun, “Whitened Résumés: Race and Self-Presentation in the Labor Market,” Administrative Science Quarterly 61, no. 3 (March 17, 2016): 469-502.

6. David Neumark, “Detecting Discrimination in Audit and Correspondence Studies,” Journal of Human Resources 47 (Fall 2012): 1128–57. 

7. Lincoln Quillian, Devah Pager, Ole Hexel, and Arnfinn H. Midtbøen, “Meta-Analysis of Field Experiments Shows No Change in Racial Discrimination in Hiring Over Time,” Proceedings of the National Academy of Sciences 114, no. 41 (October 10, 2017): 10870-875.

8. Valerie Wilson and William Darity Jr., Understanding black-white disparities in labor market outcomes requires models that account for persistent discrimination and unequal bargaining power, Economic Policy Institute, March 2022.

9. Examples include: John Bound and Richard Freeman, “Black Economic Progress: Erosion of the Post-1965 Gains in the 1980s?” in Steven Shulman and William Darity, Jr., eds., Question of Discrimination: Racial Inequality in the U.S. Labor Market, Wesleyan University Press, 1989; David Card and Alan Krueger, “School Quality and Black-White Relative Earnings: A Direct Assessment,” Quarterly Journal of Economics 107 (February 1992): 151–200; and John Donohue and James Heckman, “Continuous vs. Episodic Change: The Impact of Civil Rights Policy on the Economic Status of Blacks,” Journal of Economic Literature 29 (December 1991): 1603–43. 

10. Examples include: Augustin K. Fosu, “Occupational Mobility of Black Women, 1958–1981: The Impact of Post-1964 Antidiscrimination Measures,” Industrial & Labor Relations Review 45, no. 2 (1992): 281–94; and James J. Heckman and Brook Payner, “Determining the Impact of Federal Antidiscrimination Policy on the Economic Status of Blacks: A Study of South Carolina,” National Bureau of Economic Research Working Paper no. 2854, 1989. 

11. Examples include: Charles Betsey, “Litigation of Employment Discrimination Under Title VII: The Case of African American Women,” American Economic Review 84, no. 2 (1994): 98–102; and Jonathan S. Leonard, “The Impact of Affirmative Action Regulation and Equal Employment Law on Black Employment,” Journal of Economic Perspectives 4, no. 4 (1990): 47–63. 

12. Examples include: Leonard Carlson and Caroline Swartz, “The Earnings of Women and Ethnic Minorities, 1959–1979,” Industrial & Labor Relations Review 41, no. 4 (1988): 530–46; James S. Cunningham and Nadja Zalokar, “The Economic Progress of Black Women, 1940–1980: Occupational Distribution and Relative Wages,” Industrial & Labor Relations Review 45, no. 3 (1992): 540–55; and Nadja Zalokar, The Economic Status of Black Women: An Exploratory Investigation. U.S. Commission on Civil Rights, 1990.

13. Jonathan S. Leonard, “The Impact of Affirmative Action Regulation and Equal Employment Law on Black Employment,” Journal of Economic Perspectives 4, no. 4 (1990): 47–63. 

14. Examples include: Donald Tomaskovic-Devy, Melvin Thomas, and Kecia Johnson, “Race and the Accumulation of Human Capital Across the Career: A Theoretical Model and Fixed-Effects Application,” American Journal of Sociology 111, no. 1 (2005): 58–89; and Valerie Wilson and William M. Rodgers III, Black-White Wage Gaps Expand with Rising Wage Inequality, Economic Policy Institute, September 2016. 

15. Jenny R. Yang and Jane Liu, Strengthening Accountability for Discrimination: Confronting Fundamental Power Imbalances in the Employment Relationship, Economic Policy Institute, January 2021. 

16. Ibid.

17. See endnote 1.

18. Chang-Tai Hsieh, Erik Hurst, Charles I. Jones and Peter J. Klenow. “The Allocation of Talent and U.S. Economic Growth”, Econometrica, Vol. 87, No. 5 (September 2019), 1439-1474.

19. Adewale A. Maye and Valerie Wilson, Trump is Making it Easier for Employers to Discriminate. This Stifles Equity and Hurts Economic Growth. Economic Policy Institute, May 2025.

Affordability—or the lack thereof—has dominated the recent political debate in the U.S. And for good reason. Across the country, too many families are struggling to make ends meet. However, almost every conversation about affordability focuses entirely on prices, as if the only way to make life more affordable is to make things cheaper. 

But the actual driver of today’s affordability squeeze is suppressed pay—a consequence of decades of policy choices that weakened workers’ bargaining power and shifted income away from working people. Had pay for typical workers kept pace with productivity over the past 45 years, their paychecks today would be roughly 40% larger. 

If policymakers are serious about addressing affordability, they would champion one institution that has consistently proven capable of raising pay: unions.

Through collective bargaining, unions are the most effective mechanism for workers to raise their wages and secure their fair share of the wealth they produce. Our new report at the Economic Policy Institute quantifies how transformative it would be to rebuild union power. Specifically, we examine what we stand to gain if we tripled current union membership to 30%—similar to its peak in the U.S. before decades of relentless attacks on unions and collective bargaining eroded it, and just shy of the current rate in Canada.

We find that tripling union membership would raise pay for the typical worker by more than $7,700 every year, or nearly $270,000 over a 35-year career. This would be life-changing for a working family—nearly covering the cost of raising a child from birth through age 17, for example.

Read the full piece here. 

The bill includes a combined $71.9 million cut for the Department of Labor’s Wage and Hour Division (WHD) and the Occupational Safety and Health Administration (OSHA). Further, the measure implements a 3% cut to the National Labor Relations Board (NLRB). While the legislation slightly increases funding for the Equal Employment Opportunity Commission (EEOC) that the Trump administration has weaponized for political reasons, the amount overall remains insufficient. The appropriations measure now moves to the Senate, where the budget cuts face an uncertain future.

If enacted, these reductions would further strain these agencies that have faced over a decade of flat funding that hasn’t accounted for inflation or rising labor force participation (see Figure A). This chronic underfunding has severely impacted their ability to enforce worker protection laws.

Figure A

The consequences of underfunding worker protection agencies

The Department of Labor serves the nation’s workers by administering and enforcing most federal worker protection laws, such as the Fair Labor Standards Act, the Occupational Safety and Health Act, and the Family and Medical Leave Act. Within this framework, WHD ensures that workers receive wages earned while OHSA evaluates safe workplace conditions and standards. Moreover, independent agencies such as the EEOC enforce a range of anti-discrimination laws while the NLRB enforces private-sector labor law, including workers’ rights to a union and collective bargaining. Together, these government agencies are designed to equip workers with the tools to combat workplace abuses and rectify unequal bargaining power. However, enforcement agencies are unable to fulfill their mandates with reduced staffing and resources.

Since 1992, OSHA has experienced a 16.0% decrease in inspectors. OSHA has been left with so few resources that it would take 191 years for its inspectors to visit every workplace under its coverage just once. Furthermore, a recent Government Accountability Office report flagged critical agency shortcomings, noting OSHA’s weak efforts to address the rising tide of workplace violence against health care and social service workers.

WHD has faced similar staffing challenges. The number of WHD investigators is at its lowest point since at least 1973, despite being tasked with protecting many more workers. As a result, the total number of resolved WHD investigations has dropped significantly over the past few years (see Figure B).

Figure B

Meanwhile, the EEOC has experienced an uptick in discrimination claims over the decades alongside rising labor force participation, yet its resources have not matched the pace of these shifts. For the NLRB, funding for the agency has remained flat except for a recent $6 million reduction in case-handling. The lack of funding has severely impacted field offices—the primary point of contact for union elections—with six closing between 2014 to 2025. In 2024, the NLRB released a statement describing their struggle to meet responsibilities such as conducting hearings and elections amid funding and staffing shortages. The consequence of these challenges is evident. Although favorability for unions nears a record high, major efforts to undermine worker organizing persist.

House budget cuts would leave workers more vulnerable to exploitation

If enacted, the House’s budget cuts would exacerbate an already precarious workplace reality. There were 5,070 fatal work injuries in 2024, according to the Bureau of Labor Statistics (see Figure C). Put another way, a worker died every 104 minutes from a work-related injury. Foreign-born Latinx workers were disproportionately impacted. Reducing OSHA funding and staffing will make it even harder to ensure preventable deaths do not occur.

Figure C

Additionally, amid eroding worker protections, workers have had billions of dollars of wages stolen each year. Undocumented workers are especially impacted, with many fearing to report violations especially amid the Trump administration’s anti-immigrant policies.

Furthermore, workers continue to face discrimination, filing an average of 83,000 charges per year since 1997. Political attacks on diversity, equity, and inclusion have only eroded the mechanisms designed to address these injustices.

The House budget proposal claims to champion efficiency, but true efficiency cannot be achieved by dismantling an already vulnerable labor protection ecosystem or by slashing public-sector resources. The chronic underfunding of worker protection agencies turns legally guaranteed protections into hollow promises and leaves workers exposed to unchecked exploitation and vulnerability. A budget that truly supports U.S. workers would pass robust funding for staffing, investigators, and programs that guarantee safety, fairness, and justice across every workplace.

Investment in public education was one of the key reasons the U.S. became the richest country in the world in the 20th century. Universal education has many positive effects, including creating a more productive workforce and a more informed and engaged democratic society. Unions play a key role in advocating for public spending in education. Figure A shows that states with higher unionization rates spend substantially more per student on education.

Figure A

Adequate levels of per-pupil spending are instrumental policy for maintaining quality education. When per-pupil spending is low, students may struggle to get the support they need to achieve their learning goals. Districts, in turn, may have a harder time retaining teachers and staff because they can’t offer competitive salaries or benefits.

Increased per-pupil funding, by contrast, pays off for students. Greater funding for schools improves educational attainment, student achievement, and economic outcomes in adulthood. In one study, researchers found that a 10% increase in school spending for 12 years led to increases in high school graduation rates, 7% higher wages, and 10% higher family incomes in adulthood for children from districts that experienced the spending increase. More recently, researchers assessing the contribution of federal pandemic educational aid found that each $1,000 increase in per-pupil spending boosted student achievement in math and reading. Importantly, when researchers restricted their assessment to high-poverty districts, the per-dollar effect was nearly twice as large.

Unions are also instrumental to protecting quality public education. This is increasingly under threat due to state- and national-level voucher programs, which divert money away from public education and toward private schools and homeschooling. A substantial share of enrollees in voucher programs are often students who are already attending private school.

Vouchers reduce education quality in several ways. First, voucher programs yield worse academic achievement outcomes relative to public schools. Studies have found that students in voucher program schools experienced test score declines that are comparable or worse than declines due to COVID-19.

Second, voucher programs strain state budgets. And this cost comes at a time when states face budgetary pressure from the Republican tax and spending megabill (OBBBA), which reduced federal funding for Medicaid and SNAP (also known as food stamps).

Third, public school districts experience an additional hidden cost. When students leave public schools with a voucher, school districts lose revenue but must still pay the same amount for fixed costs that can’t immediately adjust to declines in enrollment, such as cooling/heating and utilities. These required payments for a district’s fixed costs mean that districts will have even less to spend on costs that can be adjusted—like school supplies or instructional support—thereby reducing services for students.

States with higher levels of unionization are more likely to have the political resources to fight back against vouchers in legislative fights. As a result, these states are less likely to have universal voucher programs, as shown in Figure B.

Figure B

In sum, there are many ways unions support workers and their communities, and their consistent support of public education shouldn’t be discounted. From advocating for enough funding for high-quality education to defending against education privatization, unions support our nation’s commitment to universal public education. This not only improves students’ academic achievement, but also their economic outcomes well into adulthood.

What would wages, benefits, and working conditions look like if more workers had access to a union contract and the labor movement gained strength to beat back billionaires and big corporations? What would it mean for our economy and democracy? And what policy changes are necessary to enable more workers who wish they had a union to get one?

 
On Wednesday, July 15, at 10:00 a.m. Eastern, the Economic Policy Institute hosted a virtual press conference with AFL-CIO President Liz Shuler to discuss new EPI research quantifying the economic, social, and democratic benefits of increasing union membership to 30%. Participants also shared a policy roadmap to boost union membership, including offering two new proposals to promote collective bargaining and grow union membership.

Later that day, authors of the new report, Director of Policy/General Counsel Celine McNicholas joined Deputy Director of EARN and Director of the State Worker Power Initiative Jennifer Sherer to charted the course, while Senior Economist Ben Zipperer broke down the numbers, in conversation with Executive Vice President Naomi Walker.
 

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