4 ms·
I think they are related. If a factory is in the US, and unions drive cost of employment higher, then the factory owners look to move the factory overseas to b
by ishjoh 8y ago
I think they are related. If a factory is in the US, and unions drive cost of employment higher, then the factory owners look to move the factory overseas to be more competitive. Now it's important that we also recognize that the factory owners also have to be competitive in a global landscape and against new entrants into the market, new entrants that can spring up from countries where the cost of employment is much less, so they have a strong incentive to move factories when costs rise.
Now at its disposal, a government can implement tariffs and protectionism to level the playing field, but those can have disastrous long term effects (see the history of India's protectionism).
So, an excellent way for wages to rise is to make employees extremely efficient, and to increase the demand in labor. Make no mistake though, the gains in other countries have effected US and European workers.