the fact that a worker’s wealth and well-being is much more dependent upon her employer than the employer is on a given worker tilts things in the employer’s favor.
.. Two trends demonstrate the decline of labor and the ascent of business. Since 1979, after-tax corporate profits as a share of gross domestic product have grown by 22.8 percent, while the share of nonfarm business sector income going to labor has dropped by 10.3 percent.
The decline in worker bargaining power in the United States is the cumulative effect of numerous small and large changes over recent decades reaching into almost every area of law and policy. This combines with a decline in the enforcement of existing laws that could protect workers’ bargaining power — laws protecting unions, laws against wage theft, nondiscrimination laws, and more.
.. Among these changes is the requirement that employees sign what are known as “noncompete” and “no-raid” agreements, both of which restrict workers’ ability to extract pay hikes by threatening to take similar jobs at competing companies.
.. “less than half of workers who have non-competes also report possessing trade secrets.”
When entry-level workers at fast food restaurants are asked to sign two-year non-competes, it becomes less plausible that trade secrets are always the primary motivation for such agreements.
.. The treasury report estimated that 30 million American workers have signed noncompete agreements.
.. 94 percent of the net employment growth in the U.S. economy from 2005 to 2015 appears to have occurred in alternative work arrangements.
The growing emphasis on “shareholder value” has provided additional justification for all of these anti-worker developments.
.. “the shareholder value movement starting in the late 1980s and now institutionalized through industry analysts” was crucially important in the devaluation of employees:
.. Accounting in business is mainly about costs. Finance people hate fixed costs because of the challenges they raise to share price valuation when there is uncertainty, and the biggest fixed costs are labor. Simply moving the same labor costs from employees to outside staffing companies moves it from one part of the accounting ledger to another and makes analysts happier.
This mentality, in turn, encourages “the use of temps and contractors” to fill high-wage jobs because “that way the employer doesn’t have to raise wages for all their employees.”
.. Companies could outsource work to areas with cheaper labor and less of a union presence. This both weakened the union and ramped up competitive pressure on the companies that were unionized. The result was fewer unions.
.. In 2017, 6.5 percent of the private sector work force was unionized, down from 35 percent in 1955.
.. The contemporary weakness of organized labor and the threatened status of employees has roots in the breakdown in the 1970s of the postwar capital-labor accord — what A.H. Raskin, the legendary labor reporter for The Times, called a “live-and-let-live relationship” that held sway for 30 years.
.. First, they would alter antitrust enforcement to require consideration of the likely effect of mergers on concentration in the labor market, in order to prevent “too high a risk of wage suppression.”
.. Second, Krueger and Posner would support legislation making noncompete agreements “uniformly unenforceable and banned if they govern a worker who earns less than the median wage in her state.”
.. ban no-poaching arrangements altogether:
We propose a per se rule against no-poaching agreements regardless of whether they are used outside or within franchises. In other words, no-poaching agreements would be considered illegal regardless of the circumstances of their use.
.. In the 2016 election, Trump profited from the conviction of rural and working-class voters that they were on a downward trajectory. If anything, Trump appears to be gambling that letting those voters’ lives continue to languish will work to his advantage in 2020.
.. His administration has turned the executive branch, the federal courts and the regulatory agencies into the sworn enemy of workers, organized and unorganized. Trump is indisputably indifferent to the plight of anyone in the bottom half of the income distribution:
- look at his appointments,
- look at his record in office,
- look back at his business career and
- look at the man himself.