▪ Labor markets are not highly concentrated. Local labor market concentration has been declining for decades with the most concentrated markets seeing the largest declines.

▪ Labor market power is largely due to labor market frictions such as worker preferences, search costs, bargaining, and occupational licensing rather than concentration.

▪ As a case study, changes in concentration in the labor market for nurses have little to no effect on wages, whereas nurses’ preferences over job location are estimated to lead to wage markdowns of 50 percent.

▪ Firms are not profiting at the expense of workers. The decline in the labor share of national income is primarily due to rising home values, not increased labor market concentration.

▪ Policy reform should focus on reducing labor market frictions and strengthening workers’ ability to collectively bargain. Policies targeting concentration are misguided and will be ineffective at improving outcomes for workers.