Презентация на тему "The labour market"

Содержание

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  The Labour Market

  Nguyen Maya B1-3

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  Demand for labour Marginal Revenue Product Productivity Supply of Labour The factors influencing wage differentials

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  The market for a factor of production - labour Refers to the demand for labour – by employers and the supplyof labour (provided by potential employees) Demand for labour is a derived demand- not wanted for its own sake but for what it can contribute to production

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  DemandforLabour

  Influenced by: Cost of hiring labour Wages/salaries National Insurance contributions Pension contributions Administration costs associated with tax payments and adhering to employment laws and regulations

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  Marginal Revenue Product

  MRP = MPP x P MPP = Marginal Physical Product

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  DL The demand for labour is downward sloping from left to right £250 Q1 At a relatively high wage rate of £250 per week, the value added by the worker must be greater to cover the cost of hiring that labour. Demand is likely to be lower. £100 Q2 At a lower wage rate the firm can afford to take on more workers. The demand for labour is inversely related to the wage rate DL1 Q3 Q4 The demand for labour will shift if: Productivity of labour increases New machinery is used which increases productivity If there is an increase in the demand for the good/service itself If the price of the good/service increases Quantity of labour employed Wage Rate (£ per week)

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  Productivity

  A measure of output per person per time period

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  Supply of Labour

  The amount of people offering their labour at different wage rates.

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  Size and structure of the population – age, gender, etc. Skill levels required Education and training Number in higher education School leaving age Qualification types Fashion Time period Opportunity cost of work – income and substitution effects

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  Number Employed DL SL 30 Q1 Assume this is the market for Internet developers – the initial wage rate is £30 per hour DL1 As businesses recognise the potential benefits of having a Web site, demand for their skills increases from D to D1 Q2 Shortage The demand for developers at a wage rate of £30 per hour is now Q2 but there are still only Q1 available for employment. A shortage develops. In the short run, the supply of internet developers is very inelastic 75 The shortage causes the wage rate to be forced up to £75 per hour as firms compete for the skills of those available. In the short run there is not the time for new workers to come onto the market because of the training time needed. SL1 50 Q3 In the long run, as more people train and qualify to become internet developers, the supply will increase and also become more elastic. The wage rate will fall back to a lower level. Wage Rate (£ per hour)

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  Other factors influencing wage differentials:

  Status attached to the job Discrimination Race Gender Monopsony – a dominant buyer in the market Sector – public or private Trade Union power or influence Risk or danger involved Social or unsocial hours Shift patterns Productivity

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