Do unions provide employment protection in times of economic crisis? A natural experiment of COVID-19

Abstract

Considering the COVID-19 pandemic as an exogenous shock, this article attempts to determine whether unions adjusted wages and working hours to protect their members during the economic crisis that it triggered. Based on 2018–20 Korean panel data, the author finds that, during the pandemic, union members were 1.9 times more likely to keep their jobs than non-union members. However, no significant difference is found between the wage growth in the two sectors, although union members decreased their working hours more than nonunion members. The results therefore suggest that unions provided employment protection during this period by reducing working hours, not wages.