Nature of W/L and trends in employment and earnings Flashcards
Earnings
wages, overtime pay, bonuses, commission
Structure of employment
Decline in manufacturing, rise in finance and business service sector jobs
Economically inactive
Working age people who are voluntarily out of work - not employed or unemployed
Labour force participation rate
Proportion of working age people who are economically active
Employment rate
Proportion of working age people who are in work
Part-time workers
People working under 30 hours a week
Recent trends in employment
- UK employment has grown
- Public sector more than private
- Higher proportion of female workers in public
- More public workers members of TUs
- increase in part time
- increase in self employed e.g. hairdressers
Temporary work
Casual, seasonal, working for agencies, fixed period contracting
Homeworking
Working at home or in different places away from central office
Age
- UK workers getting older
- EU workers getting older
Older workers
- Tend to change jobs less frequently
- less geog. mobile
- less likely to lose jobs but if they do, less likely to return to work
Positives of older workers
Stay in same job for longer - reduce firms turnover costs
High levels of experience
However, wage tends to rise with age
Gender trends
Women increasing proportion of LF
Major rise in the 25-44 age range
Reasons for increased female workers
Increased job opportunities (e.g. rising service sector)
Less discrimination
Increased pay
Changing social attitudes
Increased expectations of higher living standards
Occupational segregation
Dominance of an occupation by one gender
Ethnic minorities trends
On average less well paid than general population
Lower employment rates than white people
Due to discrimination - if employers believe productivity of black workers is lower than it actually is, wage rate paid to those workers will be below allocatively efficient level
Occupation trends
Largest increase in UK jobs - banking, finance, insurance
Increases in healthcare, admin, education
Decreases in primary and secondary sector - agriculture, manufacturing, fishing, construction
Regional trends
Total employment rising in most regions
London = largest rise
Yorkshire, East England = falling employment
London has highest earnings on average - high quality of work there e.g. bankers
Sector trends
Decline in secondary sector
Increase in tertiary sector
Shift from primary/secondary to tertiary = common trend as economy develops and grows
Primary sector
First stage of production e.g. fishing, agriculture
Secondary sector
Processing of raw materials into semi-finished and finished goods e.g. manufacturing, construction
Tertiary sector
Third stage - e.g. healthcare, tourist industry, education, financial services
Unit labour costs
Labour costs per unit of output
Influences on ULCs
Wages
Productivity
Other worker payments e.g. national insurance
Wages and prod. = chief influences
Tax Wedge
Gap between what employees earn, and what employers pay for labour
UK ULC
Quite poor compared to USA
Low levels of capital per worker, educational shortcomings, insufficient innovation, inefficient transport
Outsourcing
Subcontracting part of the production process to another firm
Offshoring
Subcontracting part of the production process to a firm in another country
Influence of ULCs
Higher = less price competitive
Country may have high ULCs but lower unit costs if production is capital intensive and efficient
Doesn’t say anything about quality competitiveness
Examples of offshoring
India - call centers
China - cheap labour intensive production
Forms of leisure
Home based activities e.g. computer
Out-of-home - cinema, pub
Broad categories - educational, cultural, sporting
Leisure activities are supplied by:
Private sector - cinema, pubs, gym
Public sector - libraries, parks (motivation = merit good nature of many leisure activities, question of equity)
Voluntary sector - tennis clubs, craft societies
Factors influencing demand for a particular leisure activity
Price of the activity
Price of complementary goods/services - e.g. taxi
Price of substitutes - includes work
Tastes - e.g. cinema has declined
Age composition - ageing population has led to a rise demand for things e.g. over 50s holidays
Gender composition - women read more
Advertising
Major events e.g. concert can help sell a group’s music
Exchange rate - holidays etc. (demand for currency)
Changes in the leisure market
Rise in proportion of home activities - TV
Rise in gambling
Rise in expenditure on leisure activities - rising income and more leisure time
Rise in USA’s influence e.g. private health clubs
Holidays and leisure travel
= Tourism
Most countries - tourism grown significantly
Reasons for growth of tourism
Increase in disposable income Reduction in working hours fall in the real cost of travel early retirement increased life expectancy reduction in time spent on domestic tasks improved transport increased advertising increased awareness of the benefits of tourism
Income and employment effects of tourism
Increased in no. of countries
Tourists create income and employment e.g. restaurants, hotels
Also wide range of other industries eg. insurance firms, taxi firms
However - jobs may be low skilled and low paid
effects on income and employment wont be great if goods and services used are brought in from other places
Tourism income multiplier
extent to which a change in income from tourism causes GDP to change
Effects of tourism on the BoP
Influenced by where the firms in the tourist industry obtain materials and foods, also national origin of the firms
When foreigners visit the UK, their expenditure = export
vice versa
UK has a personal travel deficit
Effects of tourism on culture
Tourists may upset locals
Demonstration effect - locals copy culture of tourists e.g. clothes, tastes, attitudes
Effects of tourism on environment
Visual pollution e.g. hotels Noise/air pollution Waste generated by tourists Congestion from tourists e.g. taxis Destruction of natural env. for hotels etc. Heavy use of water supplies
Monopoly
A market structure where there is a single seller
Cinema industry trends
Most revenue = box office takings
Recent years = growth of the multiplex e.g. milton keynes
Rise of multiplex (offers more screens, parking etc.) = cause of doubling in admissions in past years
Small places often undergo non-price competition e.g. specializing in rare films, foreign films
Attendance varies with age - mostly younger people
Concentration ratio
Percentage share of the market of a given number of firms e.g. CR5
Concentration ratios in leisure industries
The higher the CR, the less competitive pressure there is
Cinema industry has high CR
