There are many ways that sellers can gain market power. However, two of the most effective ways are: (1) by limiting the ability of their competitors to compete effectively; or (2) by restricting the ability of potential competitors to enter the market and compete with them. In both cases, because buyers/customers/clients have less choice, the seller can raise their price above their costs (which they would find more difficult if there was more competition in their market). In the case of social workers and sex workers, both have been advocating for restricting the entry of potential competitors into their markets in the last few days.
First, on social workers, Emanuel Stoakes (advocacy and communications co-ordinator for the Aotearoa New Zealand Association of Social Workers) wrote in the New Zealand Herald today:
The social work profession in Aotearoa New Zealand is at a turning point. A crucial decision is about to be made that could have long-term implications for social workers across the country.
The threat is a section of the Social Work Registration Legislation Bill which is before Parliament's social services select committee. If the bill remains as it is, it could mean up to 50 per cent of currently registered social workers and practitioners with a social work qualification in roles not described using the words "social worker" will not be required to be registered, meaning they can operate without any accountability.Occupational licensing is one way that workers can obtain market power. Sometimes, occupational licences make sense, such as when customer safety is at stake. In other cases, occupational licences make less sense. Either way though, the result is a decrease in competition for licensed practitioners from the unlicensed hordes that might compete with them, and a consequent increase in their market power. You might agree with Stoakes that social workers (or anyone doing social work even though their job title is not 'social worker') should be licensed. That's fair enough. But it doesn't mean that the licensing regime wouldn't exclude at least some potential workers who could do a quality job (such as those with social work qualifications from countries, where the degree is not 'recognised' in New Zealand). And excluding those unlicensed 'competitors' raises the market power of social workers.
What about sex workers? They are much more direct about the effects of competition on their earnings, as noted in this article in yesterday's New Zealand Herald:
New Zealand sex workers are furious that foreign prostitutes who come on temporary visas can advertise their services here despite it being illegal for them to work.
High profile escort Lisa Lewis is one of several who have taken their complaints to Immigration New Zealand (INZ) and the Minister of Immigration Iain Lees-Galloway - calling for a harsher stance against migrant sex workers...
She wants INZ to shift its focus from just deporting migrant sex workers to punish those that profit from helping the promotion of these illegal sex workers.
Lewis said the increase in number of foreign prostitutes coming over has hit local sex workers in the pocket.
"Many of the girls no longer meet the same quota as they did a few years ago," she said...
Another sex worker, who spoke to the Herald on the condition of anonymity, said her income had halved from about $12,000 weekly to about $6000 in the last two years...
"We can't compete with the type of services they offer, and besides it is illegal for us to do so," she said.
"But the fact is, every dollar that these migrant prostitutes make is a dollar taken from the back pockets of New Zealand working girls."
The laws restricting foreign sex workers from operating in New Zealand are there for good reason - to prevent cross-border human trafficking into New Zealand. However, if effective (which it seems they are not completely) they have the effect of reducing competition and giving domestic sex workers additional market power.
Both social workers and sex workers have been advocating for greater market power. However, isn't it interesting that only the sex workers are open about it?