This article argues that federal labor policy was a factor in causing the Great Compression, the dramatic compression of skill-based wage differentials that occurred in the 1940s, and in bringing it to an end. By giving the National Labor Relations Board the power to determine the appropriate collective-bargaining unit, New Dealers gave industrial unions the means with which to build a more egalitarian wage structure. Unskilled and semiskilled workers seized the opportunity and voted themselves big pay raises. Skilled craftsmen responded by petitioning the NLRB for permission to form their own craft bargaining units, a process known as “craft severance.” As conservatives gained influence in Washington in the 1940s, the board adopted a bargaining-unit policy more favorable to craft unions. By the early 1950s, skilled craftsmen had regained control of their wage demands and thereby helped bring the Great Compression to a halt.
