Effects of Trade Unions on Workers’ Job Satisfaction: Evidence from China

Abstract This study investigates the effect of trade unions on workers’ job satisfaction in China, based on panel data analyses that accommodate unobserved heterogeneity and the sorting problems—dissatisfied workers are more likely to be union members, and workplaces with poor working conditions are more likely to result in establishing unions. Based on data from the China Family Panel Studies, econometric models are estimated to evaluate the magnitude of the effect of the dynamic change in union membership status (union membership history) on job satisfaction. The results show that while unions effectively improve members’ job satisfaction and union effects vary by household registration type (urban versus rural hukou), unions fail to impress their members with the benefits they offer. The study offers several policy recommendations for rural hukou workers to benefit from union membership more effectively than they do now.