Today’s Schedule – 10/17 PPT: Labor and Wages Video: Minimum Wage HW: – Read 9.3 – Finish franchise research

Why So Much? Why So Little? If there is a small supply of workers but a high demand = big paychecks!

Labor Demand Derived Demand: Demand that is determined by demand for another good or service – Increasing demand for nurses due to increasing demand for healthcare Pay is based on productivity: value of output – Pay based on profits from output

Labor Supply Higher wages = increased supply in labor Why might this not always be true?

Equilibrium Wages Wage where there is neither an excess of supply or demand for workers

Wages and Skill Levels Unskilled- no special skills required – Janitors – Hourly wages Semi-skilled- minimal skills/educated needed – Word Processors – Hourly wages

Wages and Skills Skilled- requires specialized abilities to operate complicated equipment; little supervision – Mechanics, Bank tellers – Hourly wages Professional- advanced skills and education – Doctors, lawyers, teachers, Managers – Salary

Wages and Working Conditions High accident and fatality rate = big money! Example: Deadliest Catch

Wage Discrimination When those with same job, skill, education, performance and seniority receive unequal pay Reasoning: Women just want extra cash/will leave when have a baby

Wage Discrimination Legislation: – Equal Pay Act of 1963: Equal pay for men and women – Civil Rights Act of 1964: Prohibits discrimination – Equal Employment Opportunity Commission (EEOC) Processes discrimination claims

Wage Gap- Common Misconceptions Women’s Work: encouraged into certain fields such as teaching, nursing and clerical work – High labor supply = low wages Human Capital: women have less education Career Paths: perception of not wanting career advancement

Wage Discrimination Glass ceiling: barrier that prevents women and minorities from advancing in businesses dominated by white men

Factors Affecting Wages Minimum Wage Laws Safety Laws Subbing machinery for human labor Unions