In economics, the Baumol effect, also known as Baumol’s cost disease, first described by William J. Baumol and William G. Bowen in the 1960s, is the tendency for wages in jobs that have experienced little or no increase in labor productivity to rise in response to rising wages in other jobs that did experience high productivity growth.
Gee, imagine a world where your wages increase just because other people’s wages in a similar industry rose. Modern experience shows that either these guys were clueless or our current economy has no more than a passing relationship with the economy in their era. For the last four+ decades, real wages have been stagnant at best despite wildly increasing productivity . Whose wages in the current era are rising despite stagnant productivity?
It was the 1960s, so I have to assume that the real reason was “there was collective bargaining” and they ignored it because that got more funding
I am 100% sure if you put a union membership line on that chart it will indicate that quite clearly