Demand Of Labor Case Study

“It was the labor movement that helped secure so much of what we take for granted today. The 40-hour work week, the minimum wage, family leave, health insurance, Social Security, Medicare, retirement plans. The cornerstones of the middle-class security all bear the union label” (Obama, B. n.d.). The preceding citation by our 44th President Barrack Obama adequately inaugurates this case assignment regarding the demand of labor. To that end, this case assignment will consider factors that escalate demand for labor. Second, the market price of a good or service increases, how does this action affect the demand of labor? Next, when a government-sanctioned licensing stipulation in a certain industry is removed; what takes place to the wage …show more content…
“A profit-maximizing firm will base its decision to hire additional units of labor on the marginal decision rule: If the extra output that is produced by hiring one more unit of labor adds more to total revenue than it adds to total cost, the firm will increase profit by increasing its use of labor. It will continue to hire more and more labor up to the point that the extra revenue generated by the additional labor no longer exceeds the extra cost of the labor” (Rittenberg, L., & Tregarthen, T. n.d.). Notably, this segues into a discussion of marginal production increase and the affect this has on labor …show more content…
2006). The aforementioned quotation from Montreal Economist Nathalie Elgrably induces a good starting point for this sector of the paper. Government intervention into the labor market made provide some sort of protective layer for laborers in the general sense. This type of intervention may have a double-edged effect on both employer and employee.
It is my estimation, that while government may furnish employees with certain benefits under labor laws and regulations, such as Medicare, Social Security, and various other benefits as important as this may be. I surmise that this may prompt employers to seek an assortment of methods to cut costs, essentially leading to lay-offs in order to save money. It would be my suggestion that government involvement is minimal at best, but, at the same time ensuring employers aren’t taking away any of the employees fringe benefits. Hence, regulatory commissions will need to be on high alert safeguarding employee interest in this case. In any event, this essentially culminates this paper. The following section will provide a brief summary of the details covered in this