Labor Market Monopsony- “Widespread”?

Azar, Marinescu, and Steinbaum recently released a working paper through the Roosevelt Institute on Labor Market Monopsony.  In their words:

In short, we find that most labor markets (as defined by occupation and geography) are very concentrated, and that that concentration has a robust negative impact on posted wages for job openings. These findings are drawn from only one (large) dataset, so they are not the last word on the subject. The implication, along with the other papers cited above, is that the antitrust authorities should not operate under the assumption that labor markets are “naturally” competitive.

Their posted map of the concentration indices for each region is certainly striking:

widespread-labor-monopsony1 (1)

It seems that the entire nation is blanketed in a sea of exploitative employers!  Until, that is, we compare this map to a population density map of the United States…

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…in which “hotspots” of population are also “hotspots” of labor market competitiveness.  Colorado and Minnesota are especially striking examples of this.  This is especially relevant since the Census Bureau estimates that 80% of the US population lives in these urbanized areas, which are the same areas where Azar, Marinescu, and Steinbaum found pockets of competitive labor markets:

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US Urbanized Areas (80% of population) with AMS’ Labor Market Concentration Map

So, yes, labor market monopsony is widespread, except where there are people.

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