1.2.22 The Labour Market

Cards (16)

  • What are the Factors affecting the Demand for Labour? (4)
    Demand for the product
    Availability of substitutes
    Productivity of labour
    Other employment costs
  • How does demand for a product affect the demand for Labour?
    because demand for labour is derived demand
  • derived demand
    demand that arises because there is demand for another good
  • How does the availability of substitutes affect the demand for labour?
    The demand for labour can be affected by cost and availability of substitutes for labour
  • How does productivity of Labour affect the demand for labour?
    If every worker is able to produce more output, the demand for labour would increase, because production becomes more profitable and efficient
  • How do other employment costs affect the demand for labour?
    The other costs affect a cost to the employment
  • What are the factors affecting the supply of Labour? (8)

    Population size
    Migration
    Age distribution of the population
    Retirement age
    School leaving age
    Female participation
    Skills and Qualifications
    Labour Mobility
  • How does population affect the supply of labour?
    More population -> more supply of labour
  • How does migration affect the supply of Labour?
    More people -> More supply of labour
  • How does age distribution of the population affect the population?
    An 'aging population' means that the number of people over the age of 65 is increasing in the population, meaning that the dependency ratio is also increasing which can place a financial burden on the population
  • How does the retirement age affect the supply of labour?
    Many countries are increasing the retirement age, meaning the supply of labour increases
  • How does school leaving age affect the supply of labour?
    If a country increases school leaving age, this would decrease the supply of labour
  • How does female participation affect the supply of Labour?
    more women have chosen to enter the workforce due to cultural, societal and feminist legislative change, increasing the supply of labour
  • How do skills and qualifications affect the supply of labour?
    supply of labour increases if people are more qualified
  • How does labour mobility affect the supply of labour?(2)
    Geographically mobile: workers can move to a different region to find work, increasing supply of labour
    occupationally mobile: workers can switch job types easily, increasing supply of labour
  • what is the wage rate determined by?
    the interaction of the demand and supply of labour