Friday, February 20, 2015

Monopsonists an endangered species?

Wages are rising across America;
Wal-Mart Stores Inc. plans to boost pay for its U.S. employees to at least $10 an hour by next year, well above the minimum wage, signaling a tightening labor market and rising competition for lower-paid workers.
And not just Wal-Mart;
Companies say they are having to fight harder to attract and keep good employees. Starbucks Corp. raised its starting pay last month, and Aetna Inc. said it would begin paying its lowest-rung workers $16 an hour in April. Gap Inc. last year said it would raise starting pay to $10 an hour. Others such as Costco Wholesale, Hobby Lobby and IKEA Group tout that all their workers earn more than the minimum wage.
Mike Bufano, senior vice president for planning at Panera Bread Co. , told investors this month that the bakery-cafe chain is paying higher wages across the board, citing a war for talent. 
Well, we guess that George Stigler's high school must be worried;

  1. Menzie Chinn Post author
    Patrick R. Sullivan: I take it you are being sarcastic when you characterize monopsony in the low wage labor market as useful. I guess Stigler (who graduated from my high school! And incidently won a Nobel prize) thought it was useful.

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