Union wages, nonunion wages, and total wages

There are several ways that unionization's impact on wages goes beyond the workers covered by collective bargaining to affect nonunion wages and labor practices. For example, in industries and occupations where a strong core of workplaces are unionized, nonunion employers will frequently meet union standards or, at least, improve their compensation and labor practices beyond what they would have provided if there were no union presence. This dynamic is sometimes called the "union threat effect," the degree to which nonunion workers get paid more because their employers are trying to forestall unionization.

There is a more general mechanism (without any specific "threat") in which unions have affected nonunion pay and practices: unions have set norms and established practices that become more generalized throughout the economy, thereby improving pay and working conditions for the entire workforce. This has been especially true for the 75% of workers who are not college educated.

Many "fringe" benefits, such as pensions and health insurance, were first provided in the union sector

Union grievance procedures, which provide "due process" in the workplace, have been mimicked in many nonunion workplaces.

Union wage-setting, which has gained exposure through media coverage, has frequently established standards of what workers generally, including many nonunion workers, expect from their employers.

Until, the mid-1980s, in fact, many sectors of the economy followed the "pattern" set in collective bargaining agreements. As labor law enforcement decreased due to anti-union policies of political foes, their ability to set broader patterns has diminished. However, unions remain a source of innovation in work practices (e.g., training, worker participation) and in benefits (e.g., child care, work-time flexibility, sick leave).

The impact of unions on wage dynamics and the overall wage structure is felt most in the markets where unions are seeking to organize and the nonunion employers affected are those in competition with unionized employers.