3.5 - Demand for Labour Flashcards
What is the demand for labour?
Quantity of workers an employer/business is willing and able to hire at a given wage rate within a given time period
What type of demand is the demand for labour?
Derived
Not wanted for its own sake, but for what can be produced by it
When will demand for labour typically rise?
Demand rises
Product price rises
What is labour demand graphed according to?
Wage Rate
Employment
What does labour demand generally have an inverse relationship with?
Wage Rate
What will a fall in the wage rate create?
Substitution effect
Labour relatively cheaper than capital
Expansion in labour demand + force
What affects the aggregate demand for labour?
Economic strength/activity
Strong => Demand + Employment
Why may fewer workers be needed to satisfy future levels of aggregate labour demand?
Automation
Improved education
Improved training programmes