1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
slava [35]
3 years ago
10

Causes for increased demand of labor

Advanced Placement (AP)
1 answer:
jekas [21]3 years ago
4 0

Answer:

The following factors can increase the demand for labor:

  1. Decrease in price of labor (or wage rate);
  2. Increased Profitability of Firms
  3. Increase in the number of buyers of Labor
  4. Increase in the number of buyers of a product
  5. Availability of substitutes
  6. Shortage in the supply or availability of labor
  7. Increased productivity of labor

Explanation:

1. Decrease in price of labor (or wage rate): The price of labor is inversely related to the quantity of labor that is demanded at any time T (all other factors remaining constant). When the price of labor increases, just as with most commodities, (all other factors remaining constant, the quantity of labor demanded will fall). If however, the prices decreases, there is rea for the demand for labor to increase as owners of the factors of production will want to take advantage of cheap labor.

2. Increased Profitability of the Business

The demand for labor is by its nature a derived one. Businesses hire labor because there is work/business to be done. Business or work is related to the profitability of the same. If a business owner finds that their business is profitable and the demand for their products/services is increasing, they will invariably hire more workers. The obverse is also true. A non-performing business, financially speaking, will most likely shed its workforce thus decreasing its demand for labor in order to stay above the red line.

3. Increase in the number of buyers of a labor

As the market expands, and more players enter into a market, it is possible (all other factors remaining constant) for the increase in the demand for labor to increase.

If however, the players (that is employers in a particular market) are fewer in number then the demand for labor will be restricted.

4. Increase in the number of "buyers" of a product

A market can be said to be expanding if the number of buyers for the products in that market is increasing.

There are some markets where there are very few buyers. Two of such markets are:

A) Oligopsony: A market where the buyers are few. A real-world example is the fast-food companies. In the United States, for example, Burger King, McDonalds, Wendys, etc are the major players who purchase huge amounts of beef from cattle ranchers. They are very few in number.

B) Monopsony: In this case, the market consists of only ONE buyer.

In the above-described markets, there can only a limited amount of demand for labor.

5. Availability of Substitutes

As technology begins to advance even far beyond the anticipation of humans everywhere in the world, the threat to the demand for labor seems imminent. Factors are begining to cut costs in the long run by replacing physical labor robots that are powered by Artificial Intelligence. This means they are able to get more work done with minimal downtime, minimal supervision, and minimal loss of productivity hours which normally arises with human labor.

6. Shortage of supply of labor

Whenever there is a shortage in the amount of labor that can be hired, the prices take on an upward spiral.

7. Increased productivity of labor

Productivity of labor refers to the output per unit of labor.

If the productivity of labor increases, employers will place a higher demand on it.

The productivity of labor can be enhanced by the following:

  • Level of education and training
  • Ability to use technology

You might be interested in
Which of the following jobs would be categorized as an educational career? Select all that apply.
damaskus [11]
C. Teacher would be the correct answer
While A and B often work in . a school environment, a teacher is the best option.

~I hope this helps!~

8 0
3 years ago
Read 2 more answers
What societal groups did Christianity appeal to
Sladkaya [172]
I can see 3 main groups:

The poor - they have a promise of a “reward” in heaven if they obey Church and King.

The Church and King - it provided them with great temporal power. Ever hear of the Divine Right of Kings?

Those people that Xtian armies or “missionaries” held at sword point and gave them the choice of convert or die.
8 0
3 years ago
A 340 million square mile forest is how many hectares? use DIMENSIONAL ANALYSIS
aleksandr82 [10.1K]
There is 8.806 × 10^10 hectares in 340 million square miles.
3 0
3 years ago
What does it mean when the numbers 789 glow on a ouija board
laila [671]
Absolutely nothing at all
7 0
3 years ago
100 Points - AP Macro Questions - Brainliest to Correct Answers. Wrong Answers Get Reported
Bad White [126]

Answer:

Explanation:

20% Reserve Requirement means 1/0.2 = 5x multipliers

$5 Million x 5  = $25 Million

8 0
3 years ago
Read 2 more answers
Other questions:
  • Describe why bacteria that live within the root nodules of a soy bean plant are a critical part of the nitrogen cycle please
    12·1 answer
  • Why is it especially important that criminal justice professionals are ethical? Do you think most of them are? Why or why not?
    5·1 answer
  • RIP Kacchan, he was a je_rk but a great guy
    7·2 answers
  • How are periods<br> and groups<br> different from<br> each other on the periodic table
    12·1 answer
  • Anyone want to play a game for AP Euro Review? <br> Game Pin: 6270825
    8·2 answers
  • Which of the following best explains the effects of Mongol trade policies?
    11·1 answer
  • You want to put a fence around your large yard. You have found two companies that can do the work. They have each given you a qu
    7·1 answer
  • What is likely to happen if a borrower forgets a payment on a credit card account? (5 points)
    8·1 answer
  • Chris Langan’s story illustrates that:
    10·1 answer
  • What influenced charles Lindbergh to undertake something which no one else has ever done
    5·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!