Theme 3:3.5:Labour market Flashcards
factors that affect the demand for labour
productivity of labour
wage rates
substitutes for labour
profitability of the firm
number of firms in the market
demand for products
what is derived demand
the demand for labour is derived demand meaning it comes demand for what it produces
factors that affect supply for labour
migration
wage rates
demographics of the population
trade unions
training
leisure time
taxation and benefits
market failure in the labour markets
geographical immobility
occupational immobility
geographical immobility
difficulties which prevent FoP from moving areas e.g. higher house prices e.g. financial cost
occupational immobility
difficulties which prevent FoP from changing their use e.g.mines shut down in the UK
labour market issues
discrimination
gender pay gap
formal education
wages and skills
explain formal education
on average those who have degrees earn more over their lifetime than those who have just a levels
gov intervention in the labour market
maximum and minimum wages
public sector wage setting
policies to tackle labour immobility
minimum wages pros and cons
-it increases the standard living of the poor and incentives to work
-it can cause country to become less competitive internationally compared to countries with low wages
maximum wages pros and cons
can limit inflation as it limits consumer demand
can be a disincentive to innovate as the amount earned is capped
public sector wage setting
in the UK public sector grew in 2008- 2010 by 4.5% whereas the private sector was only 1%
the gov is the largest employer
policies to tackle labour immobility
infrastructure
lower welfare payments
affordable housing
subsidise training
factors that affect the elasticity of demand for labour
cost of labour as a proportion of total costs
ease to substitute
PED of the product
time
SECT
factors that affect the elasticity of supply for labour
-The skills of the workforce. Skilled jobs have lower elasticities than unskilled
-Length of training
Time period
