CEP LSE RSS Contact Us YouTube Facebook Twitter


CEP discussion paper
Looking for HRM/Union Substitution: Evidence from British Workplaces
Stephen Machin and Stephen Wood
January 2004
Paper No' CEPDP0605:
Full Paper (pdf)

JEL Classification: J51

Tags: human resource management; trade unions

In this paper we test the HRM/union substitution hypothesis that human resource management (HRM) practices act as a substitute for unionization. We use British workplace data between 1980 and 1998 which allows us to examine for the first time whether increased HRM incidence has coincided with union decline. First, we compare changes over time in the incidence of HRM practices across union and non-union sectors, finding little cross-time difference occurring between sectors. Second, we ask whether newer workplaces (strongly shown by other research as more likely to be non-union) have experienced differentially faster HRM incidence; we are unable to find much evidence in support of this. Third, longitudinal changes also fail to pick up any evidence of faster union decline in workplaces or industries with faster take up of HRM practices. We find no evidence of HRM substitution operating in the hypothesised way of it replacing unions and conclude that increased HRM incidence does not seem to be an important factor underpinning union decline in Britain.