What’s non-compete clauses and why is it a big deal that it’s banned?

Question

I see that the FTC banned it and (from what I see) it seems like a good thing. Why?

In: Economics

Answer 1

It is an anticompetitive practice. Essentially it prevents a worker from leaving a job and working for the company’s competition; even if the competition is an objectively better employer by wage and benefits. It’s a big deal because in many fields, non-compete clauses were the unfortunate standard for high skill jobs.

For instance if I worked as a researcher for Google’s AI department. A non compete clause would let Google sue me if I go work for a different AI company.