Worker Power and Economic Mobility: A Landscape Report

Abstract

Worker power is an important channel by which workers can achieve economic security and mobility in the labor market. This landscape report summarizes the state of knowledge on the different pathways workers can use to exercise their power and voice to achieve higher wages and better working conditions. Higher wages allow workers and families to move out of poverty, avoid material hardship, and raise their living standards. Better working conditions can improve workers’ attachment to the labor force and make them more productive and loyal employees. We propose a two-part framework of how workers achieve greater power and mobility and in the labor market: (1) leaving one’s current job for a better option (referred to as “exit”) and, (2) organizations and institutions such as labor unions that allow workers to exercise their voice in the workplace, including through input on working conditions and firm decisions (referred to as “voice”). We review empirical evidence on the market forces and policies that allow workers to express power through exit. We also summarize evidence on major institutions and policies that enable workers to gain power through voice.

Keywords: Worker power, wages, unions, monopsony, antitrust, unemployment insurance, cash benefits

JEL Classification: J00; L40