Association for Public Policy Analysis & Management

This paper uses the most recent national survey data on US local government contracting (2007-2012), combined with data on market characteristics, management characteristics and public sector unionization at the local government level to explore the dynamics of contracting in the period since the Great Recession.  Public sector unions have come under increased pressure in recent years and this paper explores their impact on contracting dynamics.  Despite political pressure to privatize, local governments experiment in both directions: we find levels of new contracting out are equal to contract reversals.  Contrary to expectations we find new contracting out is higher in unionized municipalities and contract reversals are lower. However, when we split the sample we find that nonunion localities rely more on market management, whereas unionized localities give more attention to characteristics of their service portfolio, citizen interests and monitoring both cost and quality.  Unions appear to play a collaborative role with management in ensuring successful contracting.  Public managers must manage labor, political and citizen interests and markets.  We offer new theoretical and empirical insights for understanding the role of unionization in the dynamics of local government contracting.