Why Is Pay Lagging? Maybe Too Many Mergers in the Heartland

Consolidation is often seen as a consumer problem. But it may also reduce competition for workers, especially outside big cities, holding down wages.

BERLIN, Wis. — For as long as he can remember, the only thing Matt Gies really wanted to do for a living was repair farm equipment.

But ever since he quit his job more than three years ago at a John Deere dealership — where he worked too hard for too little pay, he said — he has struggled to find a position in the same line of work.

One key reason for the difficulty is a wave of consolidation in the industry. Of the seven John Deere farm equipment dealerships within about an hour’s drive of his house, the one Mr. Gies left and refuses to work for, Riesterer & Schnell, owns four.

“It was just tough,” he said. “Everyone around here’s been bought out by Riesterer.”

Mr. Gies’s predicament is not uncommon in today’s job market. In the past few years, a growing chorus of economists has expressed concern that consolidation among companies, often considered a problem for consumers, may be limiting workers’ employment options and holding their wages down as a result.

And that, in turn, could help explain the wage stagnation that has become a vexing feature of the labor market since the late 1990s.'>>>

https://www.nytimes.com/2018/01/25/business/economy/mergers-worker-pay.html?