Join a union, take a pay cut

Members of retail unions have seen pay increases significantly below the industry average

Even as retailers faced challenges over the last three years — the pandemic, supply chain disruptions, inflation — the retail industry has experienced growth that would have taken eight years by pre-pandemic standards.

One area of significant growth is wages. Full-time retail workers saw their hourly earnings increase by 16.1% between 2019 and 2022, according to the Bureau of Labor Statistics. Starting retail wages of $15-$20 are now commonplace. Since the pandemic, retail — the largest private-sector employer — has ranked among the top two industries in terms of increased wages. As a result, retail is pulling workers from other industries.

NRF State of Retail & the Consumer 2023

NRF's State of Retail & the Consumer event discussed the health of the consumer and the retail industry.

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While retail wages have been on the rise, union membership has been declining since 2020. Some 5% of retail workers were represented by a union in 2022, which is low compared with other private-sector employers. Maybe that’s because members of retail unions have only seen weekly earnings rise by 4.8% since 2019, significantly below the industry average.

Non-union workers in the retail industry made $35 a week more than their union-member counterparts in 2022. Considering that union dues can be upwards of $400 a year, if a non-union worker was employed for a full 52 weeks, they’d be at least $2,200 better off per year than their union-member counterparts.

The job market is incredibly tight right now, and the demand for workers is driving up wages and squeezing unemployment. There are currently more open retail positions than there are unemployed people to fill them. That allows retail workers to be able to move from job to job, taking advantage of higher-paying positions. And those employees who switch jobs receive higher wage increases than those who stay put.

Flexibility is a critical factor for retailers’ competitiveness. Having non-union positions gives companies the ability and incentive to pay higher wages, offer more benefits and hire more workers. As the past few years have shown, the free market for labor produces better outcomes for workers than unions do.

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