1. Role of Labor
Ms. Biba S. Kavass

2. Objectives Define the labor force
Examine how economic trends affect labor
Explore impact of educational attainment on workforce.
Analyze labor and productivity in the United States
Economics – Biba S. Kavass

3. Tracking the Labor Force
Labor Force - All nonmilitary people who are employed or unemployed
Employed – 16 years or older who have worked for at least one hour and been paid in the last week or who have worked at least 15 hours in the past week in a family business without pay
Unemployed – those without a job but who are looking for a job
Tracked by the Bureau of Labor Statistics – U.S. Department of Labor
Economics – Biba S. Kavass

4. Economics – Biba S. Kavass

5. Changes in Employment
Economics – Biba S. Kavass

6. Effects of International Competition
Outsourcing - companies contract with another company to do a specific job that would otherwise be done by a company’s own workers
Offshoring - The movement of some of a company’s operations, or resources of production, to another country
Demand for Highly Skilled Workers
Immigration
Economics – Biba S. Kavass

7. Human Capital
Knowledge and skills that enable workers to be productive
Amount of Human Capital
Unskilled Workers – house cleaners
Semiskilled Workers – construction workers
Skilled Workers - electricians
Professional Workers - doctors
Economics – Biba S. Kavass

8. Which Level of Human Capital Are They?
___ Plumber ___ Teacher ___ Clerical Staff ___ Sanitation Worker ___ Retail Sales Clerk ___ Lawyer ___ Nurse
Economics – Biba S. Kavass

9. Why does education change your human capital?
Economics – Biba S. Kavass

10. Economics – Biba S. Kavass

11. Estimated Average Lifetime Earnings by Education Level
Economics – Biba S. Kavass

12. Check for Understanding
How do you think the change in jobs may be influencing the changes in the labor force?
How do economists explain the connection between education and wages?
How does this affect your view of what you will need for your future job?
Economics – Biba S. Kavass

13. Factors Affecting Wages
Economics – Biba S. Kavass

14. Why might the new restaurant offer higher wages?
How do the existing restaurants keep their cooks?
What other than higher wages might they offer to attract employees?
Economics – Biba S. Kavass

15. How is technology changing productivity of labor?
What is the difference between productivity and efficiency?
Economics – Biba S. Kavass

16. Reading: The Productivity Puzzle
Directions: Read the article “The Productivity Puzzle”
Answer the following questions:
Define productivity.
How is productivity related to a country’s standard of living?
What is the difference between physical capital and human capital?
How does physical capital contribute to the productivity slowdown?
How does human capital contribute to the productivity slowdown?
Why is technological change the largest contributor to productivity?
What are 2 ways the government can boost productivity?

17. Labor Unions
An organization of workers that tries to improve working conditions, wages, and benefits for its members.
Key goal is to get fair wages and wage increases for their members
Economics – Biba S. Kavass

18. Labor Unions Why don’t employers like unions?
Economics – Biba S. Kavass

19. Labor and Management
Collective Bargaining - process in which the union and company management meet to negotiate a new labor contract
Strike – leaving the job to protest labor issues
Arbitration – settlement technique in which a neutral third party listens to both sides and then imposes a decision that
is legally binding for both the company and the union
Mediation - a settlement technique in which a neutral person, the mediator, meets with each side to try to find a
solution that both sides will accept – NOT legally binding
Economics – Biba S. Kavass

20. Right to Strike?
Divide the list into those who, in your opinion, should have the right to strike and those who should not.
Bus Drivers Store Clerks
Doctors Nurses
Actors Teachers
Factory Workers Librarians
Police Officers Fire Fighters
Truck Drivers Cafeteria Workers
Economics – Biba S. Kavass

21. Minimum Wage
Economics – Biba S. Kavass

23. According to the Economic Policy Institute’s State of Working America, a stunning 35 million Americans – 26 percent of the USA workforce – earn less than $10.55 an hour
Economics – Biba S. Kavass

24. Economics – Biba S. Kavass

25. Wage Discrimination Race Ethnicity Gender Age Glass Ceiling
Economics – Biba S. Kavass

26. Check for Understanding
How does supply and demand determine wages in an industry?
Why did unions come into being? What is their main purpose?
What is the difference between arbitration and mediation?
What affect does a raise in minimum wage have on businesses?
Why does wage discrimination still exist in our country?
Economics – Biba S. Kavass