Nice theory you got there, shame it doesn't bear out in practice. In normal labour conditions workers have no leverage over employers to demand higher wages because workers have to take any job available in order to avoid homelessness and hunger. Workers demand for jobs is inelastic. Only in labour shortage scenarios workers have leverage to demand higher wages. But even then industry consolidation counteracts that because large corporations not only have price setting market power in the consumer market but also in the labour market. This is why the only consistent way to create similar leverage for worker in the labour market is unionization. Wages have never grown significantly enough to chip away wealth inequality except in the presence of strong and wide unionization. This is the main reason why increased labour productivity decoupled from wage increases since the 70s and 80s, when union busting started picking up around the world.

Rapidly increasing labour supply can make wages worse but that's not the main driver as there have been periods where wages have both been increasing with significant immigration and also others where wages were stagnant without significant immigration.

[+] maplesaga@lemmy.world -6 points 5 days ago (1 children)

Sure I'd say unionization is eroded by mass immigration and capital shallowing, wouldnt you?

[–] avidamoeba@lemmy.ca 5 points 4 days ago* (last edited 4 days ago) (2 children)

No I wouldn't. I would say unionization is eroded through various union busting strategies as practiced as far back as the 19th century. The incentives to bust unions operate on individual firm level and do not require any other macro level phenomena to explain. Firms bust unions because unions increase wages and higher wages reduce profits.

[–] group_hug@sh.itjust.works 3 points 4 days ago (1 children)

Canadian government does PLENTY of union busting. Firms and government are completely aligned on this.

Government does everything it can to keep canadian wages low to attract business. Corporations are more likely to ~~invest~~ extract from Canada if the government of Canada undermines fair negotiations and writes back to work legislation every time and stomps all over its citizens'rights.

The AC union fought back and ignored back to work orders. They had huge support among Canadians. They were then quietly taken out back and shot by the Canadian government and its arbitration.

https://www.reddit.com/r/aircanada/comments/1r7jj82/arbitration_over_for_flight_attendants/

[–] avidamoeba@lemmy.ca 1 points 4 days ago* (last edited 4 days ago)

You won't see me disagreeing with that. I've been following the AC, CP, CN strikes and I saw what you observed. I think it's not even primarily for foreign investment, although that probably is a downstrean effect. I think it's primarily for our own corporations' owners benefit. They have significant lobbying power, and at least two of the major parties ideologically support firms over workers as many of them still believe in some form of trickle-down free-market economics. It's bad. There's been no positive change in direction towards organized labour from the Carney gov't. I think they're going to discover that their promises of higher wages would fall flat without strengthening org labour. Perhaps it's a delayed tactic, an attempt to shore up the economy in these times before they let labour have its share, but that ignores that (sovereign) economic strength largely comes from robust domestic demand, which means higher wages. And I don't believe it's a delay tactic anyway. The simpler explanation is the more obvious one.

[–] maplesaga@lemmy.world 1 points 4 days ago* (last edited 4 days ago)

Perhaps increased job competition can motivate workers to unionise to defend wages and employment. On the other hand, a larger labour supply makes it easier for employers to replace uncooperative or striking workers, weakening bargaining power.

I personally see a large unemployment now as the Phillips curve inverted with high interest rates, and I now clearly see the wage suppression which erodes unions. But we can agree to disagree I guess.

I do think sometimes high skilled workers can increase productivity and increases per capita living standards, but we moved away from that under Trudeau to hide falling GDP, and to quell a wage price spiral that benefited workers and hurt asset holders who benefited from the asset price inflation of covid stimulus and QE. Productivity is what matters here though, which determines whether it helps rather than hurts existing laborers.