Do strikes pay?

One-in-forty manufacturing settlements involved a strike during the 1980s. Strike days lost were equivalent to half a day for each worker in manufacturing. On average, for the decade as a whole, real pay increases where there was a strike were 0,7 per cent a year higher than settlements without a strike. Larger bargaining groups were more likely to achieve above average pay increases from strike action than were bargaining groups with fewer employees. After controlling for other influences on settlements a strike is found to boost the annual real pay rise by 0.3 per cent, equivalent to 45 pounds a year in 1991. The "average" strike in this sample lasts 11 days. Such a strike requires the wage gain for 30 years (with a discount rate of .06 or less) for the benefit to at least equal the cost. This hints that the average strike may not be a good investment for the union. But shorter strikes are more likely to be worthwhile.