Labor Markets and Wages

What is a trade union?

• a business organisation in which all workers share ownership

• an area where there are no barriers to trade

• an organisation of employers from an industry

• an organisation that represents the interests of workers

What is an example of a non-wage factor?

• bonus

• commission

• fringe benefits

• overtime rates

What is a disadvantage of being a specialist skilled worker?

• Career opportunities are abundant

• Earnings are related to the level of skill

• It may be difficult to find work locally.

• Labour supply is elastic and plentiful.

What is most likely to increase the occupational mobility of labour?

• building more houses

• increased spending on re-training schemes

• increased total government spending

• increasing the information on job availability

Carlos has been offered a new job with a large multinational company. He is undecided whether to accept the position.

What is a non-wage factor he might consider?

• A bonus payments

• holiday entitlement

• overtime rate

• salary level

What is the most important factor that affects how much a family saves?

• the income of the family

• the level of taxation

• the rate of inflation

• the reliability of banks

Why does specialisation increase the productivity of employees?

• Average cost of production increases

• Staff turnover is high

• Time is saved by not moving between tasks

• Workers lose interest in their job

What could discourage women from seeking employment?

• More education and training are provided

• More flexible and part-time jobs are available.

• There are fewer promotion opportunities for women.

• There is a shift in employment to the services sector.

What will make it harder for a trade union to increase the wage rate for its members, without reducing employment?

• a switch from short-term to long-term fixed contracts of employment

• an increase in the number of substitutes for the product

• growth in an economy and increased demand for labour

• lower price elasticity of demand for the product

What could affect the size of the labour force in an economy?

• the existence of a trade union

• the government’s immigration policy

• the quality of university graduates

• the ratio of male to female employees