3.2 Occupations And Earnings Flashcards
Examples of non wage-factors.
- working hours
- working conditions
- pension entitlements
- holiday entitlements
- promotion prospects
- access to company car
What is net advantages?
All wage and non wage factors that effect the attractiveness of a job or occupation.
Advantages and disadvantages of specialization.
Advantages:
1) repeating tasks can improve individual’s skill and experience
2) employees can make use of their talents and skills
3) they can increase the total output and this reduces business costs
4) an increase in an individual’s productivity can lead to higher wages
Disadvantages:
1) repeating the same task can be boring and stressful
2) individual’s have to rely on other for the goods and services they cannot produce themselves
3) due to technological advancement, machines/computers take over jobs held by people. This leads to technological unemployment
The graph for a rise in the demand for labour.
The demand of labour may rise due to…
1) an increase in consumer demand for goods an services
2) increase in labour productivity
3) an increase in the cost of hiring capital equipment
4) a decrease in non wage factors for employers to pay
E.g. Decrease in employment taxes
The graph for a fall in the demand for labour.
The demand for labour may fall due to…
1) a decrease in consumer demand for goods and services
2) a decrease in labour productivity
3) a decrease in the cost for hiring capital equipment
4) an increase in non wage factors for employers to pay
E.g. Increase in the cost for health and safety equipment, training
The graph for a rise in the supply of labour.
The supply of labour may rise due to…
1) an increase in the net advantages of an occupation
E.g. Increase in holiday entitlements
2) an increase in population
E.g. more people join the workforce
3) an improvement in the education and training that’s required for an occupation
The graph for a fall in the supply of labour.
The supply of labour may fall due to…
1) a decrease in the net advantage of an occupation.
E.g. Decrease in non wage benefits
2) a decrease in population
E.g. An aging population where there are more old people and more young adults prefer to further their studies
3) a lack of education and training that is required for an occupation
Wage differentials between different occupations and groups of employees can be explained by?
The differences in the labour market demand and supply conditions.
Wages will tend to be higher in occupations in which:
1) the employee needs to have very specific abilities, skills and qualifications that are expensive and take a long time to accomplish.
E.g. Lawyer, doctor and talented football player
2) employees that require to undertake unsociable hours or dangerous tasks
E.g. Police and armed forces personnel
3) in some countries, it is tough to fill in a job vacancy due to employees being unprepared to move, or too expensive housing. The inability to change locations is called the geographical immobility of labour.
Wage differentials can vary between employees of the same occupation because:
1) there are regional wage differences
2) depending on the amount of non-wage benefits given.
The more non wage benefits, the lower the wage.
3) the number of years of experience
4) discrimination- age, gender, race, religion.
However, illegal in most countries now.
Wage differential - public sector or private sector employees.
Who earns more? Why?
In general, Private sector workers earn more than public sector workers.
This is because public sector workers have higher job security and holiday entitlements that private sector workers do not have.
However, the public sector is a large employer and needs to make wages attractive to attract and retain workers.
Wage differential - male or female employees.
Who earns more? Why?
Male employees tend to earn more than female employees.
This is because female employees usually take career breaks to raise a family.
Females also tend to take up part time jobs and jobs such as teaching, nursing and retailing that offer low wages.
However, this could also be due to discrimination.
Wage differential - skilled or unskilled worker.
Who earns more? Why?
Skilled workers earn more than unskilled workers.
This is because skilled workers are more productive. There is also a lack of specialized skilled workers.
Skilled workers are on high demand in many countries. Many firms are willing to pay more to attract and retain these skilled workers.
Wage differential - employees in different sectors.
Who earns more? Why?
Employees in manufacturing and services industries tend to earn more than those in the agricultural based sectors.
This is because the agricultural sectors are becoming more capital intensive and the demand for low skilled workers are decreasing.
The manufacturing and services industries are expanding significantly.
There is a low supply of skilled workers for advanced manufacturing industries but an abundant of low skilled workers for agricultural based sector.
