Job Guarantee drives wages up --- specifically increases wage pressure on nursing

(Matt, “Some Notes on Federal Job Guarantee Proposals,” pg online @ https://www.peoplespolicyproject.org/2018/03/22/some-notes-on-federal-job-guarantee-proposals/ //um-ef)

Inflation Contradictions

Arguments for job guarantees often contain contradictory claims about what effect it would have on inflation, the labor market, and labor demand generally. In most JG advocacy, it is simultaneously claimed that the job guarantee would employ large numbers of people without creating inflation problems and that it will create more competition for workers and thereby bid up private sector wages. Needless to say, these two things are at odds with one another.

Here’s Paul:

[1] The job guarantee would function as a de facto floor in the labor market, greatly increasing the bargaining position of workers throughout the economy. For private employers to attract employees, they would have to offer a job that is at least as good as the one offered by the government. … [2] With a job guarantee policy in place, the Federal Reserve can conduct monetary policy without promoting rising levels of unemployment. In this scenario, the job guarantee program can maintain employment and consumption expenditures while the Federal Reserve employs monetary policy to reduce private investment in order to cool the economy. … The job guarantee would function as a robust automatic stabilizer in the economy, maintaining levels of employment during economic downturns through direct hiring, and freely allowing workers to flow from the jobs program to the private sector during economic boom times.

The first statement suggests that the JG will actively compete for workers in the private sector. That is, the JG will lure workers out of their private jobs through superior compensation, thereby creating wage inflationary pressures. In his Nation piece, Sean McElwee makes this claim very explicitly, saying that nurses could quit their jobs at hospitals to work a JG job and that this would put upward wage pressure on the nursing profession.