This paper uses industry price-cost margin data to estimate the extent to which unions reduce profits. Estimates allowing for the endogeneity of union status are contrasted with estimates that assume union status is exogenous and not determined in part by either profitability or industry structure. Endogeneity is found to be an important consideration in estimating the union impact on profits: two-stage estimates are considerably larger than OLS estimates. The final section explores the total estimated redistribution from capital to labor in the manufacturing sector. An important conclusion is that unions raise prices less than was previously believed.