Dive Brief:

• Public approval of U.S. labor unions hit 71% — the highest level since 1965 — as the tight labor market induced by the pandemic gave workers more clout over employers, Gallup said.
• “The low unemployment rate that developed during the pandemic altered the balance of power between employers and employees, creating an environment fostering union membership that has resulted in the formation of unions at several high-profile companies,” Gallup said in analysis of a poll.
• Nearly two out of three unionized workers (65%) said that the prospect of gaining better pay and benefits prompted them to join a union, with 57% citing ensuring employee rights and representation, Gallup said. Two in five unionized workers consider membership “extremely important,” with another 28% rating membership a “four” on a five-point scale.

Dive Insight:

CFOs confront both an unusually tight labor market and intense pressure to raise wages.

Unemployment fell in July to 3.5%, equaling a 50-year low last seen before the pandemic. Also, job openings in July rose more than forecast to 11.2 million from 11 million in June, close to a record and double the number of unemployed workers, the Labor Department said Tuesday.

Employers have increased pay in an effort to attract and retain workers. Average hourly earnings rose 5.2% in July compared with a year earlier, and have exceeded 5% on an annual basis every month this year, according to the Labor Department.

Still, with the consumer price index rising 8.5% in July, or close to a four decade high, real average hourly earnings fell on an annual basis by 3%.

CFOs may not realistically expect wage pressure to decline as long as pay increases lag inflation and the number of job vacancies far exceeds the number of unemployed people looking for work.

For many workers, the pandemic highlighted the need for union representation, the Economic Policy Institute said in a blog post commenting on the Gallup poll.

Despite the risk of infection, many workers in health care, food service and other essential services stayed on the job without “appropriate health and safety gear and certainly without pay commensurate with the critical nature of the work they were doing,” the institute said.

Labor organizers are on the move with promises of higher pay and benefits.

Union representation petitions filed at the National Labor Relations Board (NLRB) surged 58% from Oct.1, 2021, until June 30, exceeding the number of filings during all of fiscal year 2021, the NLRB said. Charges of unfair labor practices rose 16% during the same period.

Union organizers have scored high-profile wins at Amazon and Starbucks during the past several months.

Still, unions seeking to increase membership have lots of catching up to do.

Just 10.3% of wage and salary workers belonged to labor unions last year compared with 20.1% in 1983, the first year in which comparable data was available, the Labor Department said.

Also, while 11% of nonunion workers are “extremely interested” in joining a labor union, 58% are “not interested at all,” Gallup said.