Wages Flashcards
Different wages in the same occupation
Geographical differences affecting the demand & supply of labour
Different wages in different occupations
Different skills and qualifications Nature of the job and hours worked Job satisfaction Lack of information about jobs and wages Labour immobility Fringe benefits
Investigating differences in wages between different groups of workers
Younger & Older workers Male & Female Workers (the gender pay gap) Skilled & Unskilled Workers Public Sector & Private Sector Workers Different industries
4 Advantages of Division Labour
More goods and services are produced
Full use of employees’ abilities
Time saving
Increase use of machinery / capital goods
Disdvantages of Division Labour
Repetitive work is boring
Workers may feel alienated
Firms are unable to use labour flexibility (workers are less mobile)
Products are too standardised
Specialisation Advantages
Specialisation allows individuals to make the best use of their skills
Specialisation allows individuals to make the best use of their skills
Disadvantage or Advantage
Advantage
Specialisation Disadvantage
Specialising on a skill only can cause occupational immobility
Specialising on a skill only can cause occupational immobility
Advantage or Disadvantage
Disadvantage
Equilibrium Wage Rate
The price of labour (the wage paid) is determined where the demand for labour meets the supply of labour.
Factors affecting the Demand of Labour
Changes in consumer demand for goods & services
Changes in the productivity of labour
Changes in the productivity and the price of capital
Changes in non-wage employment costs
Factors affecting the Supply of Labour
Changes in the net advantages of an occupation
Changes in the provision and quality of education & training
Demographic changes
Changes in non-wage employment costs
Factors affecting Demand or Supply?
Demand of Labour
Demographic changes
Factors affecting Demand or Supply?
Demand of Supply
5 Types of Wages
Time rate Weekly wage Piece rate Fixed annual salary Performance-related payments (i.e. commission, share of the firm’s profit)
