Treasury caused consternation in the labour movement on Tuesday by suggesting the best way to win a pay rise might be to switch jobs.

It looked to unions like an attempt to blame workers for their bosses’ failure to grant a pay rise.

But the discussion should not provoke outrage because the Treasury may just have handed unions their best argument yet for changing the rules around bargaining between employers and employees.

Meghan Quinn, the deputy secretary of Treasury’s macroeconomic group, told the Australian Conference of Economists in Melbourne about a new Treasury paper on the causes of Australia’s wage stagnation.

First, she said, there were the “standard” causes: lower inflation and inflation expectations, slower productivity growth, high rates of participation and spare capacity in the labour market, and the end of the commodity price boom.

Then Treasury went looking for other factors to explain the remaining wage growth weakness.

The paper finds that “more frequent job switching is associated with higher real wage growth, even for those that stay in their job”, Quinn said.

“This research suggests that a 1 percentage point decrease in the job switching rate, for any given demographic or cyclical conditions, is roughly associated with a ½ percentage point decline in average wage growth.”

The fact the job-switching rate declined from 11% in the early 2000s to 8% today may therefore be to blame for today’s slow wage growth.

But why? The paper argues that lower labour market fluidity “may have reduced workers’ confidence and power in negotiations, and thus lowered the scope for rent sharing”.

“Equally, lower labour market fluidity could reflect decreased feelings of job security amongst workers due to globalisation and technological advancement.”

And here’s why the paper is not all bad news for the labour movement: it acknowledges the power imbalance between employers and employees.

The only reason changing employers works as a strategy to increase workers’ pay is because their current employers are paying them below market rates.

Unless an employer is preternaturally generous, they tend to hire employees by paying them as much as they have to to get the right person in the right job, and every year after they pay them as little as necessary to get them to stay.

When you factor in perceptions of job insecurity and weighing the risk of possible future recession, it’s rational that workers want to stay put. Deloitte Access Economics hinted at this last month when it argued robots are not stealing our jobs – but that fear may be contributing to wage stagnation.

By suggesting that switching jobs is a tool in the modern worker’s arsenal to even out that power imbalance, the Treasury paper hints at the more obvious solution hiding in plain sight.

Industrial action – including through the collective withdrawal of labour in the form of a strike – is more effective for a group of employees to gain a pay rise than one or two walking or threatening to walk to a competitor.

It is curious the Treasury didn’t study decreased union density or the record low days lost to industrial activity when it went looking for causes of wage stagnation.

But what it did say is still revealing. Job switching works because every move realigns a worker’s current pay with their actual market value. Even those staying put benefit because the easier it is to make a move the more employers have to keep up with what others are paying.

Unions should rise to the occasion to argue this paper tells us what we already know: employers will only pay more if forced to – and threatening a day off work will do just as well as threatening to leave for a competitor.