The Labor Market Impact of the Proposed Sprint–T-Mobile Merger

December 17, 2018

In partnership with the Economic Policy Institute, Adil Abdela and Marshall Steinbaum examine the impact of the proposed Sprint/T-Mobile merger on the labor market. Cutting the number of national players in the U.S. wireless industry from four to three, this move would escalate market power in the industry and worsen wages for wireless retail workers.

Abdela and Steinbaum find that, if the Sprint–T-Mobile merger is approved, average weekly earnings for retail wireless workers would decline by between 1 and 3 percent in most affected labor markets, with earnings falling by as much as 7 percent in the most-affected labor markets. For the 50 most-affected labor markets, those percent changes correspond to a decline in annual earnings of between $520 and $3276 on average.

In this paper, Abdela and Steinbaum provide a framework for how regulators can integrate labor markets into merger review. As explored in The Effective Competition Standard, antitrust law and enforcement must be renewed in the 21 st century economy by going beyond consumer prices and taking workers’ wages and working conditions into account when examining mergers. The health of our economy, society, and democracy depends on it.