On the side of the employees, unions have proven themselves to be good means to improve the situation for employees. Here in Germany they definitely have helped in many industries.
My comment was more about the companies though which may form cartels to drive down employee wages. Companies forming cartels is illegal, while unions are legal in many places.
Yeah but even at that point faang (or well at that point apple, Ms, google, Netflix didn't exist and Facebook broke the cartel) compensation was significantly more than people in Europe were making.
And with anti-collusion labor protections, engineers stood to make even more.
In the US, union workers make between 10% to 30% more than their non-union peers[1].
You're comparing pay across two different economies and only looking at unionization as a variable. It's like wondering why engineer rates in Omaha, Nebraska aren't on par with those in New York, and concluding that it has something to do with differing fire codes.
> And with anti-collusion labor protections, engineers stood to make even more.
Correct, but these protections exist (and existed at the time) independent from a union.
> In the US, union workers make between 10% to 30% more than their non-union peers
There's very few high-skill jobs which are commonly unionized. In a market where supply is greater than demand, then yes unions have absolutely shown to improve worker outcomes[1]. I'm not aware of any evidence for markets where demand outstrips supply (like that for skilled software engineers). It's not immediately clear that union protections would be beneficial.
>You're comparing pay across two different economies and only looking at unionization as a variable.
No, I'm simply pointing out that your flippant response to esoterica doesn't actually address the question. If unions are better for workers, why is it that a non-union area !!with a cartel depressing wages!! was still substantially better for workers than a unioned area with no such issue?
Saying "oh the market is different" ignores the question of why the market is different.
[1]: Indeed, that's kind of exactly what happened with this cartel. Facebook wanted to hire skilled engineers, and was willing to pay more, so broke the cartel. That kind of thing won't happen when workers are generally equivalent, but SWEs aren't.
> There's very few high-skill jobs which are commonly unionized.
Sure there are. Doctors and actors, to name just a couple. In both cases the "union" actively works to create barriers to entry.
The AMA colludes with medical schools to set artificially-low student body quotas. If you've ever wondered why teaching "XYZ for pre-meds" is such a miserable experience, this is why. You have to earn straight A's to get into med school because there are so many more qualified candidates than openings (but it's not clear to me how, say, art history or algebra-based physics makes you a better doctor).
SAG (the screen actors guild) requires actors to have already performed in a SAG production a a condition of membership. And they also strictly limit the number of non-SAG performers on SAG productions. That chicken-and-egg problem was very intentional
If you've ever taken a macro economics course, you know what effect these actions have on prices.
> I'm not aware of any evidence for markets where demand outstrips supply (like that for skilled software engineers). It's not immediately clear that union protections would be beneficial.
See above. Unions can create a market where demand outstrips supply.
> If unions are better for workers, why is it that a non-union area !!with a cartel depressing wages!! was still substantially better for workers than a unioned area with no such issue? Saying "oh the market is different" ignores the question of why the market is different.
So tell me why professional associations exist, then. Why do doctors form a union to increase wages, if as you say, they would be better off without it?
> Sure there are. Doctors and actors, to name just a couple. In both cases the "union" actively works to create barriers to entry.
Neither the SAG nor the AMA are unions in the traditional sense. In many ways, the AMA actively works against worker quality of life (consider that the horrible conditions for med students/residents and the high suicide rate among MDs) to artificially reduce supply.
>Why do doctors form a union to increase wages, if as you say, they would be better off without it?
The AMA is mainly a lobbying organization, not a union. Since a significant percentage of doctors are in private practices or small practices, they don't have representation with the government. So sure, the AMA does collectively bargain with the US Government. But by that same token, since 53% of MDs are self employed, the AMA can't do "normal" union things like set wages, because there's no one to bargain with except the doctors themselves.
And interestingly, the AMA actually admitted that its intentional supply-reduction is hurting the medical industry as a whole. To answer your question, "because they thought it would be better". But in hindsight, they probably weren't.
I've said that they are good means, not the best means. And I guess the reason why they are paid so little is the higher profit margins of FAANG companies as well as probably the alternative in SV that you can found a startup and make much much more if you're good (and lucky).
Unions are basically legalized price fixing. What happens is that the union negotiate a "fair" price, and then all companies decide to pay no more than said "fair" price. See for example (original is in Swedish):
The problem is that the numbers that gets published by unions in Sweden are taken as law by employers. You don't really know what unions are like if you haven't heard your employer say "We can't give you a bigger raise due to our collective agreement". And since basically all other employers follow the same guidelines you can't get competing offers for significantly more. There is a reason why salaries are very flat in Sweden.
Another way to see it, collective bargaining goes both ways, ie both workers and employers will come to a joint agreement. So if we created a FAANG engineers union and created a joint pay-scale for them, then that would basically be equivalent to the non poaching agreement often derided in discussions like this.
Not all union models have sector bargaining and it certainly doesn't work for professional unions - and I am not saying that European unions really get the needs of m&P members and need to change.
My comment was more about the companies though which may form cartels to drive down employee wages. Companies forming cartels is illegal, while unions are legal in many places.