3.2 – Occupations and Earnings Flashcards
What are the different payment methods for Labour?
Time-Rate wage
Piece-Rate wage
Salary
Performance-related payments
What is the time-rate payment method?
Wage given based on the no. of hours the employee has worked.
What is the piece-rate payment method?
Wage given based on the no. of output produced. The more output a employee produced, the more wage he earns
What is the salary payment method?
Monthly payments made to workers, usually managers, office staff, etc. in non-manual jobs
What is performance-related payment method?
Payments given to individual workers or teams of workers who have performed very well. Commission comes under performance-related pay.
What affects individual’s choice of occupation?
Wage factors and Non-Wage factors
What are Wage factors?
The wage conditions of a job/firm such as the pay rate, the prospect for performance-related pay, bonus, etc. will be considered by the individual before he chooses a job.
What are Non-Wage factors?
Hours of work Holiday entitlement Quality of working environments Job security Fringe benefits Training opportunities Distance from work to home Pension entitlement
What is Labour Demand?
The demand of labour by firms to produce goods and services at a given wage rate.
What is Derived Demand?
A demand for a commodity, service, etc. which is a consequence of the demand for something else. In tis case, the higher the demand for a product, the more labour producers will demand.
What is Labour Supply?
Supply of labour available and ready to work in a industry at a given wage rate.
What leads to a backward bending labour supply curve?
When a person get to a very high position and his wages/salary increases highly, his no. of hours may decrease.
What does the analysis of the demand and supply curve show?
Labour demand and supply will extend and contract due to changes in the wage rate. Other factors that cause changes in demand and supply of labour will result in a shift in the demand and supply curve of labour.
What factors cause a shift in the labour demand curve?
Consumer demand for goods and services - demand goes up, so does labour demand
Productivity of labour - the more productive, the higher the demand
Price and productivity of capital - if capital price were to drop, labour demand would also drop.
Non-wage employment costs - if these costs increase, demand for labour will fall.
What factors cause a shift in the labour supply curve?
Advantages of an occupation - eg: If the no. of hours worked in the airline industry increases, the labour supply there will shift to the left.
Availability and quality of education and training - if education for a specific field will be low, so will the supply in that field
Demographic changes - curve will shift depending on the population.
