Wednesday, August 30, 2006
A More Perfect Union
Drew McManus, over at Adaptistration, is wondering how people feel about the impact of organized labor on the orchestra business. This subject is directly related to something I've been thinking about -- the fact that orchestra jobs are not simply "good jobs" in the standard economicspeak sense of high-paying, or high-pay-low-effort, but desireable for the specific work itself. I would speculate that the importance of the specific job is more important to orchestra players than to people in most other industries, for instance a violin player wants to play violin in an orchestra and that outcome is substantially better than teaching voilin to highschool students or working in arts administration, but a doctor who ends up being a Neurologist rather than a Cardiologist is probably going to be nearly as satisfied. In other words, the marginal utility of the first-choice musician job over the second-choice musician job is substantially greater than the marginal utility between the first and second choice jobs in most other fields.
Basic economics tells us that utility can be analyzed with money -- I spend my $20 on the new Steve Reich CD because that makes me happier than spending it on a lottery ticket or the new Milton Babbitt CD. I wouldn't buy the lottery ticket at any price, but if the Babbitt CD cost, say, $2 I would buy it. Musicians get utility from having a music job, and they get so much more utility from having their first choice job that we can consider it part of the compensation, and that compensation can offset a certain amount of monetary compensation. If you could choose between playing violin in an orchestra for $100K per year versus a job as a lawyer for $100K per year you'd take the orchestra job. What if the job only paid $50K? How about $30K? How about $0? Maybe not, but this is exactly why so many actors and musicians are willing to wait tables for years and years in hopes of getting that break that lets them go pro in their chosen fields.We also know that the demand for orchestra jobs vastly outstrips the supply, or from the other angle the supply of orchestra labor vastly outweighs the demand for it. Sure, some labor is better than others, but even the pool of adequate to superb labor is glutted. Thus, by the rule of supply and demand, the cost of orchestra labor should be dirt-cheap. And this is where collective bargaining comes in.
If the orchestra can force musicians into bidding wars with each other they can get hire at Wal-Martesque wages, but if the musicians band together into a cartel they can demand higher wages. And there are additional benefits as well. In the non-unionized universe an orchestra that wanted to pay higher wages wouldn't be compteitive and would be forced to pay the market rate anyway. Plus, as a result of low wages some of the best talent would be driven out of the market and while the average quality of players would still be good (because of the glutted market) they arguably wouldn't be as good. If your primary selection criterion is price, you force out expensive but high-quality options, but with unionized price-fixing the primary selection criterion becomes skill (and with higher wages the talent pool increases). Higher labor costs probably do result in fewer orchestras, but the ones that survive are healthier. You might reasonably argue that fewer orchestras and higher ticket prices are bad for classical music as a whole, but I would suggest that ticket prices and the supply of concerts rank significantly lower than other cultural factors (coolness, class identity, age identity, etc.) in driving audiences away. So on balance I would say that the downsides for the classical music scene are far outweighed by the benefits.