WASHINGTON (AFP) – The decline in unionisation and moves by employers to stop workers from changing jobs have undermined competition in the United States (US) labour market, lowering American salaries by 20 per cent, the Treasury Department said on Monday.
“Capitalism without competition isn’t capitalism. Capitalism without competition is exploitation,” Treasury Secretary Janet Yellen said during a roundtable with workers affected by the practices.
The cost of anti-competitive measures are “severe” and “large enough to meaningfully change a family’s standards of living,” she said.
President Joe Biden has repeatedly blamed corporate consolidation for pushing up prices, and last year he signed an executive order aimed at increasing competition in the world’s largest economy.
The Treasury conducted a study, which came out of Biden’s order, to look at the impact of increased consolidation on workers.
The report found “the American labour market falls far from the perfect competition that economists had long assumed due to employer concentration and anti-competitive labour practices”.
This is a “significant problem”, and the report estimated the “lack of competition causes wage declines of roughly 20 per cent for workers, relative to what they’d otherwise earn”.