labour markets (micro) Flashcards
What is a gig economy?
A labour market in which temporary, flexible jobs are the norm.
What do workers in a gig economy typically work as?
Independent contractors, freelancers, or temporary employees
What are two examples of companies that operate within a gig economy?
Uber and Lyft
What is a key benefit of a gig economy?
flexibility for workers.
What is a downside of a gig economy?
workers do not have the same protections and benefits as traditional employees, such as health insurance, paid time off, or job security
Uber and Lyft have created disruption to traditional labour markets.
What has this raised questions about?
Labour rights and protection for workers in this new economic model.
What risks has the hand car wash sector consistently been identified with?
Exploitation and modern slavery.
What has the hand car wash sector got a reputation for?
- employing undocumented workers
- Paying low wages well below legal minimum wage.
What percentage of car washes had written contracts with workers?
6% - report from Nottingham university
Why is there environmental concerns with the car wash market?
10 % of UK’s daily supply of water
much of it taken illegally through sources such as public standpipes.
What negative externalities that could cause environmental concerns does the hand car wash sector produce?
- Car wash waste water (contains phosphates)
- detergents
- surfactants
- oils
- sediments
- metals
Give an example of a monopsony employer?
The NHS - the main buyer of doctors and nurses in the UK
Does the NHS exploit workers with monopsony power?
- No profit motives as it is a government run sector
- Could cut wages, however, to fund other government sectors.
What is gross pay?
Any wages that come directly to an employee
e.g. commission or basic wage
What is net pay?
what’s left of income after income tax and national insurance have been taken off.
What are possible advantages from specialisation within an economy?
- Higher output per worker
- Improve the quality of goods
- Improve an economy’s ability to export more goods
- Greater variety of choice for consumers.
What are moral considerations for businesses?
- equality of pay for staff
- The environmental impact of production
Give ‘demand factors’ impacting the demand for labour?
- Profitability of firms
- The performance of the economy
What are the main roles of trade unions in the labour market?
- Pay bargaining (real wages)
- Protecting pension rights
- employment rights
- working conditions including health and safety at work
- lobbying for improved minimum wages and workplace training funding
- campaigns on discrimination
reasons for long-run decline in UK trade union membership
Structural change in employment
Globalisation and flexible hiring
factors that affect trade union bargaining power in the labour market
- Union density and membership - negotiating leverage
- economic climate - scarcity of skilled workers
how are wages determined when a monopsony employer negotiates with a trade union?
- Monopsony have buying power when hiring labour.
- They can use this power to pay a wage lower than the MRPL
- Trade union might help to counter-balance monopsony exploitation
What are factors that might explain the gender pay gap in the UK labour market
- Age and the glass ceiling effect - links to women taking a career leave effect.
- Occupational clustering effects - many jobs such as social care, accommodation and food services - relatively low pay but high female concentration.
What percentage of children are living in relative poverty in the UK?
27%
What are policies that might be used to help reduce ‘working poverty’ in the UK
- higher minimum wage
- child support
- legal protection of workers’ rights
What is Aldi an example of?
wage-productivity theory - that higher wages means less turnover of workers and more motivated productive workers
What company has been accused of wage theft?
Boohoo - it will pay an estimated £125m in underpaid wages
