Antitrust in Labor Markets: Insights from the FTC Hearings on Competition and Consumer Protection in the 21st Century
Cartel & Joint Conduct Review Newsletter of the ABA Section of Antitrust Law Joint Conduct Committee - Volume 14, No. 2 Winter 2019
Competition in labor markets has been become a key issue over the past several years. In particular, there has been a growing debate among regulatory agencies, antitrust practitioners, and economists about the potential competitive effects of wage-fixing and no-poach agreements, as well as about the applicability of existing merger-analysis tools to labor markets. These topics, among others, were the focus of two panels on antitrust issues in labor markets convened by the Federal Trade Commission (FTC) on October 16, 2018.
The key points of the panelists’ debate on these issues are summarized and reviewed by Analysis Group Managing Principal Jee-Yeon Lehmann, Vice President Rebecca Scott, and Associates Tímea Laura Molnár and Liz Neyens in the article “Antitrust in Labor Markets: Insights from the FTC Hearings on Competition and Consumer Protection in the 21st Century,” published in Cartel & Joint Conduct Review, the newsletter of the American Bar Association Section of Antitrust Law Joint Conduct Committee.
The authors begin by outlining the concept of monopsony power in labor market models and summarizing a debate among panelists over whether increasing employment concentration in the US explains the stagnation in US wages over the past several decades. They then turn to a discussion of whether the consumer welfare standard, as it is currently interpreted, can properly address antitrust issues in the labor market. They conclude by summarizing the panelists’ recommendations for priorities in labor-market antitrust enforcement and research.