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9 Cards in this Set
- Front
- Back
Market failure in the labour market |
When labour is not being fully utilised |
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Geographical immobility of labour |
Where workers are unable to move to different places to seek and find work |
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6 ways to combat geographical immobility of labour |
-state provision of housing -relocation grants for workers -housing market reforms to encourage people to rent out empty houses -improved transport -move public sector jobs out of London -encourage firms to to start up/ move to areas of high unemployment |
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Occupational Immobility of Labour |
Workers are unable to change jobs or take up new opportunities due to a lack of skills or training |
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Three ways to combat occupational immobility of labour |
-improving general education to improve the flexibility of workers -directly provide specific training for workers to target skills shortages in certain industries -subsidise training schemes done by employers themselves |
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Three current labour market issues and how to solve them |
-retirement age- ageing population etc, - can raise the pension age, increase tax,improve health of old people by so much they are able to work -youth employment- high supply of workers but not demand for new employees-offer training or encourage firms to take on younger employees -skills shortage- firms need employees to do skilled jobs but there are none available eg engineering- incentivise young people to train in these areas or flexible contracts eg zero hour |
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Effects of immigration on labour market |
-increased supply of labour decreases wage rate- goods are produced at lower cost -less consumer spending as lower wage rate however more total people so AD would increase -increased exports- however remittances |
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Impacts of minimum wage |
More supply and less demand for labour- real wage unemployment, unemployment depends upon wage elasticity of demand |
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Impacts of maximum wages |
-lower inflation -less incentive to do high paid high stress jobs eg CEO -Caps public spending if in public sector -higher equality |