3.5 Labour Markets Flashcards
1
Q
What is the demand for labour?
A
- The quantity of labour that employers wish to hire at a given wage rate
2
Q
What are the 6 factors affecting Demand for labour?
A
- Wage rates
- Demand for the product
- Prices of other factors of production
- Wages in other countries
- Technology
- Regulations (e.g., illegal jobs or being forced to train)
3
Q
What are the 4 factors effecting Elasticity of Demand for labour?
A
- Direct Correlation to PED of the product
- Proportion of wages to total cost of production (the larger the proportion, the more elastic the Elasticity of Demand for labour)
- Substitutes (computers)
-Time (i.e. how long it takes to gain the skills)
4
Q
What is supply of labour?
A
- The willingness of workers to be employed at a given wage rate
5
Q
What are the 7 factors that influence the supply of labour?
A
- Wages
- Population
- Migration
- Non-monetary benefits (e.g., holidays)
- Education
- Barriers to entry (e.g., visa’s)
- Legislation (e.g, retirement age)
6
Q
What is Occupational Immobility of labour?
A
- When labour cannot move between jobs due to lack of skills
7
Q
What is geographical Immobility of labour?
A
- When labour cannot move between locations
(can cause excess demand or excess supply as people cannot leave or move)
8
Q
What are the 3 factors affecting elasticity of supply for labour?
A
- Level of training and qualifications
- Availability of substitutes
- Time
9
Q
How are wages determined in perfect competition?
A
- By supply and demand
10
Q
Where are wages set in a monopsony market? Why?
A
- Lower than in perfect competition
- They can employ less workers at a lower price (single buyer)
11
Q
What are the 7 labour market issues?
A
- Young workers
- Retirement
- Wage inequality
- Zero-hour contracts
- The ‘gig economy’
- Skill shortages
- Migration
12
Q
What are the 4 Government intervention methods for labour market issues?
A
- National Minimum Wage
- Maximum wages
- Public Sector wage setting
- Tackling immobility
