Split labor market theory

Split labor market theory was proposed by sociologist Edna Bonacich in the early 1970s as an attempt to explain racial/ethnic tensions and labor market segmentation by race/ethnicity in terms of social structure and political power rather than individual-level prejudice. Bonacich argues that ethnic antagonism emerges from a split labor market, where two or more racially/ethnically distinct groups of workers vie for the same jobs, and where the total cost to the employer of hiring workers from one group is significantly lower than the cost of hiring from the other group. Employers prefer to hire cheaper workers and will do so absent active opposition from higher-priced workers, creating an antagonism between higher- and lower-priced groups. Differences in the price of labor are sociological and political in nature, not a matter of personal preference, so that, e.g., native, unionized workers, who enjoy full political rights will demand higher wages and be more likely to resist employer prerogatives than undocumented immigrant, non-union workers from poorer countries. According to Bonacich, likely outcomes of a split labor market include not only antagonism but, depending on the political power of higher-priced workers, a caste-like system where lower-priced workers are restricted to specific occupations, or total exclusion of the lower-priced group from the labor market.

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