Odd Lots Anna Stansbury on How to Boost Worker Bargaining Power
Aug 4, 2022
In this discussion, Anna Stansbury, an MIT economist specializing in labor economics, reveals the troubling decline of worker bargaining power and its impact on wage growth. She explains how inflation complicates workers' purchasing power and the long-term reduction of labor's income share. Stansbury advocates for reforms like sectoral bargaining to strengthen unions. She compares U.S. and European labor models, emphasizing the importance of representation and corporate concentration's role in negotiations. It's a deep dive into how to empower today's workforce.
AI Snips
Chapters
Transcript
Episode notes
Measuring Worker Power
- Worker power is the ability to share in company profits beyond market-determined compensation.
- It's measured by comparing actual worker pay to hypothetical market pay.
Drivers of Worker Power
- Unions are a significant driver of worker power, enabling profit sharing.
- Other factors like norms, fairness, and managerial incentives also play a role.
Tight Labor Markets and Worker Power
- Tight labor markets are necessary but insufficient for reversing long-term declines in worker power.
- While they benefit lower-income individuals and minorities, they don't automatically boost broader worker power.