>I see "wages would rise to match the value contributed by employees, which would reduce the surplus that businesses can extract."
I understand that theoretically the wage would be negotiated to the point where it was no longer attractive to poach or be poached and everyone's life would continue along swimmingly. The problem is that I don't believe this would happen in the Real World. There is just too much emotion involved, and perception is too fickle, for this to work out well for anyone. The industry's productivity would be deeply damaged, not just from the high-level executive POV where you're comparing year-over-year profit-dollars-per-employee, but also from the tangible, objective POV, where it would take much longer to get things done.
There's a reason that anyone who gets caught up in a poaching war takes effort to avoid that situation from occurring ever again, and there's a reason that employees aren't going out and more actively inciting bidding wars no matter how fun it sounds in theory to have two or more companies tripping over themselves to outbid each other for you. Putting aside the actual economic realities that would be incurred, employees have real emotional needs that would be difficult to meet in a poaching culture. People need continuity and camaraderie. People need a sense of accomplishment and contribution. Those things are not going to occur if 25% of your workforce churns over to the competitor and back again every year, and like I said, while I understand the theory that the churn would eventually stop once a "market price" for the labor was stabilized, I don't think that's how it would play out in real life; I think the entities would commonly harbor feelings of resentment and betrayal, and I think many participants would adopt other combative emotional stances, that would deeply impede the industry's function.
I'll have to do some research and see if I can find some real-life data that may credit or discredit this theory.
We also need to acknowledge that anti-poaching agreements can be interpreted in various ways. My understanding is that most of these agreements bar active recruitment or incitement of sitting employees at members of the pact, but they do not bar hiring an employee away if he seeks you out. There may be exceptions and this may have changed depending on the interpretation of different persons in the HR dept. I definitely believe that refusing to hire employees who seek out employment externally due to your no-poach agreement is uncool.
If you're a CEO of a large company worried about the impact that poaching will have on your company and on the industry as a whole, you don't have to sit around and wait for the churn to eventually stop when the market price stabilized. You can go out and make it happen by paying your people better.
We agree that there is some salary level where that constant churn of poaching doesn't happen, right? As you said, people generally like to stay where they are. That means that poaching will only work if you can offer something substantially better. When employees are paid well enough that it's not worth paying them substantially better just to convince them to leave their current job, the poaching churn will stop.
If Jobs wanted to stop the poaching churn without being evil and without breaking the law, it would have been easy: go out and figure out what that salary level is, and start paying it. Or heck, he wouldn't even have to go that far. If we assume that the "no poaching" level is vastly higher than current salaries, all he'd have to do is pay, say, 50% higher than the other companies around, then keep an eye on things and continue bumping up compensation if and when other companies started to follow along.
I don't see how that scenario has any negative outcomes for anyone besides shareholders and executives who counted on being able to pay $1 to an employee in return for $10 of value forever. There would be no feelings of resentment and betrayal, no combative emotional stances, because none of the churn you describe would happen.
Faced with poaching, Jobs had three alternatives. He could ignore it, he could collude with other companies to stop it, or he could pay his people well enough to make the problem go away. The only reason to choose collusion over better pay is to save money by giving less of it to your workers.
I understand that theoretically the wage would be negotiated to the point where it was no longer attractive to poach or be poached and everyone's life would continue along swimmingly. The problem is that I don't believe this would happen in the Real World. There is just too much emotion involved, and perception is too fickle, for this to work out well for anyone. The industry's productivity would be deeply damaged, not just from the high-level executive POV where you're comparing year-over-year profit-dollars-per-employee, but also from the tangible, objective POV, where it would take much longer to get things done.
There's a reason that anyone who gets caught up in a poaching war takes effort to avoid that situation from occurring ever again, and there's a reason that employees aren't going out and more actively inciting bidding wars no matter how fun it sounds in theory to have two or more companies tripping over themselves to outbid each other for you. Putting aside the actual economic realities that would be incurred, employees have real emotional needs that would be difficult to meet in a poaching culture. People need continuity and camaraderie. People need a sense of accomplishment and contribution. Those things are not going to occur if 25% of your workforce churns over to the competitor and back again every year, and like I said, while I understand the theory that the churn would eventually stop once a "market price" for the labor was stabilized, I don't think that's how it would play out in real life; I think the entities would commonly harbor feelings of resentment and betrayal, and I think many participants would adopt other combative emotional stances, that would deeply impede the industry's function.
I'll have to do some research and see if I can find some real-life data that may credit or discredit this theory.
We also need to acknowledge that anti-poaching agreements can be interpreted in various ways. My understanding is that most of these agreements bar active recruitment or incitement of sitting employees at members of the pact, but they do not bar hiring an employee away if he seeks you out. There may be exceptions and this may have changed depending on the interpretation of different persons in the HR dept. I definitely believe that refusing to hire employees who seek out employment externally due to your no-poach agreement is uncool.