Labor, Wages and Unions Economics - Chapter 9

Business Market Review -Identify the four -Key characteristics -Examples

Labor Market Objectives -How are wages established? -What is productivity and what makes workers more productive? -How do we choose jobs?

Labor Market Place in which workers seek jobs, And employers seek workers

Factors that determine wage rates A. Is demand the same for all types of labor? What separates different forms of labor B. Supply and Demand Businesses “buy labor” Individuals “sell labor” The supply of different types of labor is not the same Generally, wages will be higher where the demand for labor is greater than the supply C. Productivity D. Education / Skill-set

Supply and Demand in the Labor Market A. The price of labor is called the WAGE RATE B. If quantity of labor is supplied is GREATER THAN quantity demanded = SURPLUS of labor (think unemployment) C. If there is a SURPLUS; wages FALL D. If quantity of labor is LESS THAN quantity demanded this is a SHORTAGE of labor E. If there is a shortage of labor; wages INCREASE

Supply and Demand in the Labor Market The demand for labor A downward-sloping demand curve indicates that employers hire more people at lower wage rates

Supply and Demand in the Labor Market The supply of labor An upward-sloping supply curve indicates that more people are willing and able to work at higher wage rates

Why do some people earn more than others? A. PRODUCTIVITY B. Supply of different types of labor is not the same. C. Demand for different types of labor is not the same. D. Education training/skills required (related to education and training)

Is money the only thing that matters? A. Benefits= money + nonmoney benefits B. Give an example of a nonmoney benefit

Minimum Wage Objectives -What is minimum wage? -Who sets it? -What is the federal rate? MN rate? -What are some economic arguments pro- con about it?

Minimum Wage A.The minimum wage law is a federal law that specifies the lowest hourly wage rate that can be paid to workers. - This law was originally passed during the Great Depression. B.Current Federal rate $ MN rate $9.00

Minimum Wage A.Pros / Cons B.Impact of minimum wage on the quantity of jobs offered?

Minimum Wage A.Understanding the debate - Video 1Understanding the debate - B.What are the effects of raising the Minimum wage - Video 2What are the effects of raising the Minimum wage C.Who earns the minimum wage - Video 3Who earns the minimum wage -

Labor Union Objectives - Analyze changes to worker’s rights since the 1900’s. -Evaluate the importance of regulations by government and unions. - How did unions get established? What impact and tools do they have? What are some economic arguments pro-con about them?

Labor Unions A. Labor Unions - groups of people in specific fields of work that advocate for rights. i. Unified voice ii. STRIKE - an act of walking off the job to advocate for rights

Triangle Shirtwaist Factory Fire Story Video clip -One of the greatest driving forces in the securing of Worker’s Rights. Early Labor Unions

Understanding Unions Advantages a. Better pay and benefits for members b. Collective voice for the rights of members Disadvantages a. Members pay dues b. Business profits may decrease What occupations often have strong unions today? Example - teachers What do these occupations have in common?

Unions and worker violations - today - Wal-Mart (#1 search result when you search “worker’s rights violations”). - Industrial facilities have been found guilty of worker endangerment - Massey Energy- Mine collapse in OSHA (Occupational Safety and Health Administration)