Test Answers on Chapter 9 – Flashcard
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Labor force
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all nonmilitary people who are employed or unemployed
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Bureau of Labor Statistics
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provides answers to two important economic questions: how many people are in the labor force? How many are unemployed at any given time?
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Learning effect
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the theory that education increases productivity and results in higher wages
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Screening effect
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the theory that the completion of college indicates to employers that a job applicant is intelligent and hard-working
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Contingent employment
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a temporary or part-time job
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Derive demand
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demand that is determined by demand for another good or service
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Productivity
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value of output
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Equilibrium wage
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the wage rate that produces neither an excess supply of workers nor an excess demand for workers in the labor market
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Unskilled labor
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labor that requires no specialized skills, education, or training Semi-skilled labor: labor that requires minimal specialized skills and education
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Skilled labor
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labor that requires specialized skills and training
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Professional labor
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labor that requires advanced skills and education
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Glass ceiling
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an unofficial, invisible barrier that prevents women and minorities from advancing in businesses dominated by white men
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Strike
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an organized work stoppage intended to force an employer to address union demands
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Featherbedding
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the practice of negotiating labor contracts that keep unnecessary workers on a company's payroll
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Right-to-work law
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a measure that bands mandatory union membership
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Blue-collar worker
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someone who works in an industrial job, often in manufacturing
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White-color worker
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someone in a professional or clerical job who usually earns a salary
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Collective bargaining
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the process in which union and company representatives meet to negotiate a new labor contract
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Mediation Arbitration
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a settlement technique in which a neutral mediator meets with each side to try to find a solution that both sides will accept
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Arbitration
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a settlement techniques in which a third party reviews the case and imposes a decision that is legally binding for both sides
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Labor union
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an organization of workers that tries to improve working conditions, wages, and benefits for its members
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What kind of information does the Bureau of Labor Statistics report?
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Information about historical trends
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According to the BLS, give examples of people outside the labor force. Are these people considered unemployed. Why? Who is considered unemployed?
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The percentage of the U.S. population in the labor force has increased from 59.2 percent in 1950 to 66.6 percents in 2003. In June, 2003, the national unemployment rate of 6.4 percent was higher than the average by recent standards. The number of employed civilians in the U.S. in 2003 was about 137,738,000
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Describe the history of occupational trends in the U.S
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United States was a nation of farmers. The Industrial revolution created more blue-collar jobs and factory jobs. The invention of the computer, created more computer-related jobs.
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How does the screening effect differ from the learning effect?
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The completion of college indicates to employers that a job applicant is intelligent and hard working.
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Why is the United States producing fewer goods and more services?
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Fewer jobs call for physical strength. Instead jobs require brainpower and personal skills, placing men and women on equal footing. Machines produce the goods.
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How has the labor force changed in the last fifty or sixty years?
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More businesses are replacing permanent, full-time workers with part-time and temporary workers. More women are joining the labor force.
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Why are more women working today than fifty years ago?
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Women were encouraged to get a higher education and add to their human capital, they increased their earnings. In addition, as more and more jobs become available in the service sector of the economy, jobs require brainpower and personal skills, placing men and women on equal fitting.
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Why are some companies relying more on temporary employees?
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Flexible work arrangements allow a firm to easily adjust its work force to changing demands of output. Discharging temporary workers is much easier than discharging regular, permanent employees, since temporary workers do not receive severance pay, and temporary workers have fewer legal rights in the workplace. Temporary workers in many industries are paid less and given fewer benefits than their permanent, full-time counterparts. Some workers actually prefer these flexible arrangements to traditional, permanent jobs; thus, the market reflects their preferences.
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Choose two occupations, one that pays high wages and one that pays low wages. Explain the reason for the difference in wages in terms of supply and demand. What other factors may explain the differences?
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Demand is determined by demand for another good or service. Most restaurants in the city pay $12 an hour for cooks who generate $20 an hour in revenue for the restaurants. The possibility of profit will attract other restaurant entrepreneurs. Competition will push up the wage for cooks to nearly $20. As a result, cooks will be paid close to the value of their productivity.
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What is a labor union? How does collective bargaining work?
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An organization of workers that tries to improve working conditions, wages, and benefits for its members. Collective bargaining is the process in which union and company representatives meet to negotiate a new labor contract.
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What are some of the key goals of labor unions?
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Get wage increases for members. Negotiating labor contracts that keep unnecessary workers on a company's payroll
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Why have unions declined in the United States?
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Unions press employers to their member's wages. When wages go up, the quantity of labor demanded goes down. Thus, the number of union jobs decreases. As union jobs are cut, more workers are forced to seek nonunion jobs. An increase in the supply of available nonunion workers causes the wage rate for nonunion jobs to fall.
