Wages  The price of labor  Payments workers receive in return for work  Governed by the forces of supply & demand /animated_economics/ec09_anim_labor.html

The restaurant is willing to hire more chefs if the hourly wage is lower. Number of workers Hourly wage (in dollars)

As the wage increases, so does the number of workers willing to work as fast food chefs.

Equilibrium Wage  The wage at which the quantity of workers demanded equals the quantity of workers supplied; the market price for labor

Why Do Wage Rates Differ?  The rates of pay for specific jobs or work performed

Human Capital  Unskilled Workers  No training needed. House cleaners & Sanitation workers  Semi-skilled Workers  Received some training (Construction & Clerical workers)

 Skilled Workers  Significant investment in training (Plumbers, electricians, mechanics )  Professional Workers  Doctors, lawyers  Jobs with intensive specialized training

Working Conditions  Higher wages are often paid to workers in dangerous and unpleasant occupations in order to attract qualified people

Discrimination in the Workplace  Glass Ceiling – Women can see the top but never attain the top levels of management.

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Government Actions  Minimum wage – the lowest wage legally allowed for one hour of work  Minimum wage acts like a price floor, designed to boost wages for low – income workers

Civilian Labor Force  People 16 & up who are employed or actively looking for and available for work  DOES NOT include military, prison, or people in mental hospitals.

Three Economic Sectors Primary Sector  Made up of jobs related directly to natural resources  Examples: Farming, forestry, fishing, mining

Secondary Sector  Jobs related to the production of goods, including the materials and energy needed to produce them  Examples: welders, truck drivers, & construction workers

Tertiary Sector  Made up of service – related jobs  Examples: Banking, insurance, retail, education

WHAT IS HAPPENING TO AMERICAN JOBS DUE TO GLOBALIZATION?

Changes in Labor Telecommuting  Doing office work somewhere other than a traditional office Contingent Employment  Temporary or part-time work Independent Contractors  People who sell their services to businesses on a contract basis

OUTSOURCING : The practice of contracting with an outside company, often in a foreign country, to provide goods or services There are many reasons this is done: 1.Many other countries have much cheaper labor available. 2.If corporations want to expand into other markets, sometimes it helps to do business in those markets. 3.You can cut down on shipping costs if you have a business located where the goods are going to be sold. jobs-steal-stolen-US-workers

Insourcing  The practice of foreign companies establishing operations in, and therefore bringing jobs to the U.S ?playlist= &section= &tab= /5/11 IIT – Imported from India