New Report: “Right-to-Work” States Still Have Lower Wages

Brand new report from the Economic Policy Institute:

In this paper, we update that research and subject the results to a series of robustness tests. We utilize more recent data from the Current Population Survey, and employ a cost-of-living indicator from the Bureau of Economic Analysis that was only made available in the years following the release of Gould and Shierholz (2011). Last, we subject our results to various robustness tests as suggested by Sherk (2015) regarding choice of specific explanatory variables. We find that the main results hold under any reasonable alternative specifications. Only extensive data-mining and non-standard specifications of wage equations can move the estimated RTW penalty to statistical insignificance. Our central findings are:

  • Wages in RTW states are 3.1 percent lower than those in non-RTW states, after controlling for a full complement of individual demographic and socioeconomic factors as well as state macroeconomic indicators. This translates into RTW being associated with $1,558 lower annual wages for a typical full-time, full-year worker.
  • The relationship between RTW status and wages remains economically and statistically significant under alternative specifications of our econometric model.

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