Job (dis)satisfaction and workplace representation in Europe

This study examines job satisfaction in Europe comparing establishments with and without formal workplace representation. The backdrop of the study is a literature that has largely focused on union membership in Anglophone nations and which has long struggled with the finding that union members are seemingly less satisfied with their jobs.

The current literature is inadequate for the study of labor markets in Europe where low union density is generally coincident with near universal coverage by collective agreements, as is for example the case in Portugal. In a new departure, this paper replaces union membership with the presence or absence of institutions of formal worker representation at the workplace (viz., local union agencies and works council type bodies). 

Using data on 28 nations (including Portugal) from the 2010 and 2015 waves of the European Working Conditions Survey (EWCS), the paper finds that workers in plants with worker representation record lower job satisfaction than their counterparts without representation.

This result may simply reflect a tendency for less satisfied workers to be attracted to jobs with worker representation. To understand this selection issue, and because the EWCS waves do not have longitudinal content, the paper generates different cohorts in order to control for unobserved person effects. Implementation of this pseudo panel model indicates that the negative correlation found in cross section persists.

Possible endogeneity of workplace status itself is also addressed, and the results are once more supportive of a causal negative. Against this backdrop, the paper contends that recent claims about a shift in the relationship between union membership and job satisfaction are likely premature. Persistence of a representation gap is a possibility, in which case job dissatisfaction is grounded in a desire on the part of employees for even greater involvement in decision-making.

Click here to go to the paper by John T. Addison and Paulino Teixeira.