Tesla’s Terrible Earnings, the FTC’s Noncompete Ban, and 24/7 Trading at the NYSE | Prof G Markets
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Worker Empowerment
The ban on non-compete agreements by the FTC is poised to significantly empower workers by allowing them to freely change jobs, potentially increasing wages. argues that non-competes limit the number of bidders for a worker's labor, effectively transferring wealth from younger employees to older shareholders 1. He highlights that one-third of minimum wage jobs are subject to these agreements, which is detrimental to wage growth 2.
The more people bidding on your labor, the more potential people who want to rent your labor, the higher the rents you can charge.
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This change is expected to increase average annual earnings by more than $500, offering a much-needed shift in the balance of power from employers to employees.
Corporate Pushback
Corporate pushback against the FTC's ban on non-compete agreements is strong, with major business groups like the US Chamber of Commerce suing to block the ruling. They argue that the ban could compromise their ability to protect intellectual property, fearing that employees might take valuable IP to competitors 2. counters that existing laws already protect against IP theft and that companies should focus on creating environments that retain talent voluntarily 3.
How the fuck can you be against that? But how are people saying, oh, labor is making too much money, the average earner is making too much money, and corporations aren't doing well enough.
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He believes the ban will ultimately foster innovation and competition, as evidenced by California's thriving economy without non-competes.
