Labour Economics
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Transcript of Labour Economics
Labour Economics
PersaudApril 6, 2013
Labour as a Resource
• The demand for labour is viewed in the same way as the demand for goods and services
• How do we figure out how much labour we need in the market place?
• Workers are the suppliers, business firms are the consumers and the price is the wage rate
Demand for Labour
• Direct Demando Can be looked at as the demand for goods and services.o Directly use our dollars to indicate how much we want the
goods/service (utility) at every price level.
• Derived Demando Derived or dependent on consumer demand for the good or
service.o In other words, the greater the quantity demanded of a good or
service, the greater the quantity of labour demanded to produce it.
Productivity
• Important concept when looking at the labour market.
• Not just important to know how much of a product is demanded, the labour market is also affected by how MUCH each worker can produce in a specified period of time.
Marginal revenue product of labour (MPRL)
• Explains how demand for labour is derived
• As an additional unit of labour is added to a firm’s productive process, the additional output that is created is known as the marginal product.
• See page 172 in your text books Fig. 8.1
Factors that shift the labour demand curve
• There is a change in quantity demanded as the price of labour changes
• Factors that may shift the labour demand curve:o Change in the demand for the product of labour.
• (e.g. if there is a decrease in demand for cars, then the demand for auto workers will decrease)
o A change in the price of other productive resources• If it is cheaper to use automation in a factory, the demand for
the factory workers will decreaseo A change in worker productivity
• If workers are more productive, then the demand for them will increase – better worker training and/or better management
Supply of Labour
• Number of people willing to offer their services to firms at each of the possible wage rates
• As wages increase, more people are willing to offer their services in the labour market.
Considerations that affect the supply curve:- specific skills – eg doctor- geographic location – remote area fewer people - jobs that seem unpleasant/dangerous – fewer people
willing offer their services
Factors that shift the labour supply curve
• Changes in the income tax rates – more taxes, less workers
• Changes in size and composition of the populationo Age distribution ex.
• Changes in household technology – more free time to enter the workforce
• Changes in attitudes around work – women, gen x
Unemployment Rate as an Economic Indicator• Unemployment Rate : the % of the labour force who are
not working but are actively seeking employment
• On board calculation.
Milestone 1• Date 1
Milestone 2• Date 2
Milestone 3• Date 3
Milestone 4• Date 4
Timeline
Date 1 Date 2 Date 3 Date 4
Timeline
Date 1
Date 2
Date 3
Date 4
Timeline
Video : Generation Jobless CBC Doc Zone
Video : Generation Jobless CBC Doc Zone
• http://www.cbc.ca/doczone/episode/generation-jobless.html
Looking Ahead
• When is the next milestone?
• What are the expected deliverables?
• Known risks and issueso What is the investigation timeline for
these issues?
• What are the immediate next steps?
Dependencies and Resources
Project
Vendors
Manufacturing
SalesEngineering
Remote Teams
Appendix
Appendix
• Budget
• Design documents
• Marketing plan
• Supplemental documents
• Contact information