It is essential to closely review the state of the labor market to define its type and the need for government intervention. My local labor market, St. Louis, has the most job postings in Missouri during the last quarter of the previous year (“St. Louis real time labor market summary,” 2021). The labor market there heavily relies on skilled workers, with 28% of all new vacancies coming from the healthcare sector (“St. Louis real time labor market summary,” 2021). Due to the globalization process, it is more convenient for companies that operate in free markets to transfer unskilled labor abroad (Budd, 2021). The free labor market in the United States created a unique environment for businesses of all sizes.
The freedom of the U.S. labor market brings concerns along with its benefits. The positive effect of the free market is the customer-focused business relationships which promote competitiveness and boost productivity (Budd, 2021). However, if the system is left entirely unregulated or any of its aspects is found abusable by businesses, the effect on customer experience will be the opposite (Ostoj, 2017). The proposed concept of the free market contains a significant amount of assumptions and simplifications, which, in reality, must be accounted for by government regulations (Ostoj, 2017). Even in its current state, the free labor market can be deemed partially unfair by workers.
While it is not possible to leave the labor market completely unregulated, imposing additional regulations is often viewed as problematic for reasonable concerns, such as unfair price distribution (Budd, 2021). Therefore, there is a need for a loose set of government regulations over the labor market to avoid exploitation of the workforce, yet it must remain close to libertarian values to achieve a favorable outcome.
References
Budd, J. W. (2021). Labor relations: Striking a balance (6th ed.). McGraw-Hill/Irwin.
Ostoj, I. (2017). Inevitable level of labor market regulation in the globalization era. 17th International Scientific Conference Globalization and Its Socio-Economic Consequences. The University of Zilina, The Faculty of Operation and Economics of Transport and Communications, Department of Economics.
St. Louis real time labor market summary. (2021). Missouri Economic Research and Information Center.