The Demand and Supply of compassTopic 4 Labour Markets Economics?Labour is the human element of the production process?Labour marketplace is a factor market where the supply and deal of outwear interact to deter momente wage rate and parcelling of labour resources in an industry?Wages = income of employees/price of labour/ represent to employers using labour?Outcomes of labour market important considerations in the achievement of govts macro objectives of price stability and extensive physical exercise?Wage harvest-tide will affect aggregate ask and call for inflation?In competitive market, interaction of demand and supply of labour determine wage pass judgment and allocation of labour resources?Govts intervene in labour markets to make negligible wage direct (award rate), resolve industrial disputes, set min conditions, leave provisions, superannuation etc.
?Aim of macroeconomic policy is unsex full employment and price stability?Govt also intervenes on microeconomic scale to make labour market as efficient as possibleDEMAND for Labour?Demand for labour derived from demand for the final goods that that labour is used to produce eg a rich labour group will produce many widgets which ar very productive and make large pelf and credit line employs to a greater extent labour for greater profits?Also derived from level of economic activity, productivity of labour, relative cost of labour against crown?Microeconomic factors influencing the demand for labouroNature and size of an industry e.g.
expectant intensive industry demands less labouroPattern of consumer demand and output e.g. a regrets in the demand for leaf blade means less steel workersoWage rate and conditions of employment offered eg more profitable industries with higher prospects for growth will be more able to attract more labour by offering higher wage rates and fringe benefits to employeesoProductivity of labour eg rising levels of productivity will put out to an increased demand for labour. This will lead to higher profits by the firm and a rise in employmentoRate of capital/labour substitution eg...
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