Monday, April 21, 2014

How To Limit Employee Wages In Silicon Valley

Software engineers earn good wages and many would like to enjoy their standard of living.  This article describes a suit by software engineers against several of the tech giants in Silicon Valley.  They are charged with engineering an agreement that would limit labor competition in Silicon Valley.  Wages tend to rise when the companies compete with each other for the best talent.  They are accused of agreeing not to recruit software engineers from the consortium of companies that are a party to the agreement.  This article provides some the information that the companies would like to exclude from a potential trial.  The information might influence the jury and the companies would not like it to become public.  After all, constraining labor market competition is not part of the prevailing neoliberal ideology.  On the other hand,  the easiest way to increase profits and shareholder value is to constrain wage growth.  Most of these companies also use the patent system to limit competition.  Managing the rules of the competitive game is in the interest of the management of these companies.  They are also large shareholders.  Perfect competition is not in their interest, nor is it in the interests of any market participant.  Corporate strategies are devoted to reducing competition in their selected market segments.

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