A Hidden, Potent Source of California's Economic Vitality

A Hidden, Potent Source of California's Economic Vitality
AP Photo/Eric Risberg

Americans, we are told, believe in competition. But a shockingly large number of workers — 30 million, according to a report from the Treasury Department — are shackled by what are called “noncompetes,” which are agreements forbidding employees to leave their job to work for a competitor or to start their own competing business. And the number is growing fast.

Once reserved for a corporation's most treasured rainmakers, noncompetes are now routinely applied to low-wage workers like warehouse employees, fast-food workers and even dog sitters. One out of every six workers without a college degree have signed one. By including them in employee contracts, employers can use the threat of litigation to constrict wages and employee mobility.

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