Featherbedding

Featherbedding happens when a company has its employees doing unnecessary busywork, or too many employees for the job at hand, or pays its employees higher than market wage. You might be saying “hey, that sounds like a job I had...but the busywork was good, because...job security.” Exactly. Employers don’t like featherbedding.

To be clear: featherbedding is not when employees are more productive than their bosses realize, but the employees don’t say anything.

Rather, featherbedding runs when an employer agrees to something (most often a labor union contract) that induces them to add in busywork or hire too many employees knowingly. This makes the business a little less efficient in theory, but is better for workers, which, in theory, could lead to more efficiency, but that’s a whole can of economic-data worms that’s beyond the scope of this here blurb.

Featherbedding was a common response as technology began to replace human jobs. You heard that right: the robots are here for your jobs. When technology replaces jobs at a slower rate, things aren’t so bad: people and the economy have time to adapt. But technology has been growing at an exponential rate, changing way too fast for people (and the government) to address it in another way.

While firms don’t like featherbedding (which is a kind of deragatory term), economists would say it's redistributed surplus profits from companies to employees who would likely otherwise be unemployed. Depending on the economist you ask, this could be bad (inefficiency is bad for the economy!) or good (employment is good for the economy!).