I'm in a union and they don't "reward seniority over everything else". In my experience this is either made up or affects some narrow class of jobs but is used as an excuse to bash all unions. As another response says, unions do what their members want.
Pilots bid for jobs based on seniority and are laid off in reverse order of seniority. Same with police officers. Every union job there is has a concept of seniority number and there's no way to get around that unless you go into management in which case you're no longer in the union (such as smaller police departments where the lieutenant and/or chief are not under union purview).
They also don't hire anyone. They are not the ones who do the hiring. Airlines it seems - for a current example - have relinquished some hiring / firing authority to union rules.
Seems to me (most) unions and old-style corporations reward seniority because they are captured.
(Roughly speaking) the old-timers stick together because they can and because there are old-timers. And few people get promoted because there is only a very narrow path upward (say, 6-10 lower to a ground-floor supervisor, 6 of these to a higher rank). That necessarily creates a very thin path up. And there is space up only when the previous person is promoted or leaves. There is respect for the skill of a senior employee when it has been proven but respect will only buy you so much. Mostly that skill is put to good effect without massive salary change. There is nominal seniority-based salary increase because that's affordable and easy to manage - and is captured. That is, this salary scale was designed by the previous seniors. Same for promotion order and layoff order.
Seniority then becomes a way to "force" loyalty: If you jump, you may not be one of the top dogs who think they have captured the system. No need for (much) higher salaries if the staff themselves support seniority.
My brother works in a grocery warehouse in CA. Their union seems very seniority focused. He’s worried about being laid off but doesn’t want to look for a new job as he said his seniority clock would start over at the new place.
Don’t you have like scales that automatically increase with age? Of course there’s different levels of scales, but I’m fairly certain there is an age component.
One thing to understand is that while the US and Europe both have a thing called "unions", they are different enough beasts that any comparison between the two are essentially meaningless. Even comparing "unions" between European countries is pretty tricky.
