1. + Labor Market ________________

2. + Labor Unions: An organization of workers that tries to improve working conditions, wages, and benefits for its members. One of the unions’ main tools is a strike. An organized work stoppage intended to force an employer to address union demands. Types of Unions: Industrial (many jobs) and Craft (single occupation) Collective bargaining: The process in which union and company representatives meet to negotiate a new labor contract. Union contracts generally last 2 to 5 years and can cover hundreds of issues. If an agreement is not able to be reached by these representatives, mediation or arbitration may be needed.

3. + Labor related Legislation: 1932: Norris-La Guardia Act Made it more difficult for employers to obtain injunctions against union activity and outlawed yellow-dog contracts. 1935: National Labor Relations Act (Wagner Act) Gave workers the right to organize and required companies to bargain in good faith with unions. It also creates the National Labor Relations Board to oversee union elections and ensure that union members were treated fairly. 1938: Fair Labor Standards Act Created the minimum wage, outlawed child labor in many workplaces, and required firms to pay overtime for work beyond 40 hours a week. The act was the nation’s first nationwide, mandatory federal regulation of wages and hours. 1947: Taft-Hartley Act An effort to curb union power. Allowed states to pass right-to-work laws (measures that ban mandatory union membership).

4. + Unions in Decline? Right-to-work Laws? Most of these states are in the south, production will move to this location because they are less union friendly. Membership: Peaked in the 1950s at about 30 percent of the nation’s nonfarm work force. By 1997, union membership dropped to just 14.1 percent of the nonfarm work force. Structural Changes in the economy: Unions have been traditionally strongest in the manufacturing sector, a high portion of this sector are blue-collar workers. Blue-collar jobs have been declining causing union jobs to disappear. Foreign competition Unions are the weakest in the white-collar professions. Rising number of women joining the workforce. Women are less likely to join unions and fewer women work blue-collar jobs.

5. + Types of Workplaces: Closed Shop: hires only union members. This type of workplace is now illegal. Union Shop: will hire nonunion members but requires them to join the union within a certain period of time. Agency Shop: will hire nonunion members and does not require them to join the union in order to keep their jobs. However, nonunion workers must pay union dues or similar fees, and they are covered by the union contract. Free-rider effect

6. + Labor Force: All nonmilitary people who are employed or unemployed. Employment: People are considered employed if they are 16 years or older and meet at least one of the following requirements: They worked at least one hour for pay within the last week; They worked 15 or more hours without pay for a family business, such as a farm; They held jobs but did not work due to illnesses, vacations, labor disputes, or bad weather. Unemployment: People are counted as unemployed if they are 16 years or older, not institutionalized (nursing home or prison), not currently working, and meet one of the following criteria: They are temporarily laid off from their job; They will be reporting to new jobs within 30 days; They are not working but have actively looked for jobs within the last 4 weeks.

7. + Labor Statistics: Statistics are calculated by the BLS (Bureau of Labor Statistics) They try to answer two questions: 1. How many people are in the labor force? 2. How many are employed and unemployed at any given time? The BLS reports the unemployment rate every month These figures indicate the health of the labor market https://www.stlouisfed.org/education/economic-lowdown-video- series/episode-4-the-labor-market https://www.stlouisfed.org/education/economic-lowdown-video- series/episode-4-the-labor-market

8. + Supply and Demand for Labor: Employment or unemployment in a labor market depends on how closely the demand for workers—the number of available jobs—meets the supply of workers seeking jobs. The demand for labor comes from private firms and government agencies that hire workers to produce goods and services. In most labor markets, dozens or hundreds of firms compete with one another to hire workers. In a competitive labor market, workers are usually paid according to how much revenue they produce. Aka: Productivity- the value of output How to firms and workers react to changes in wages? Supply of labor comes from households, they supply labor in exchange for wages. Equilibrium wage: the wage rate that produces neither an excess of supply of workers nor an excess of demand or workers in the labor market.

9. + Wages and Skill Levels: 1. Unskilled labor: requires no specialized skills, education, or training. Usually earn an hourly wage. Examples: restaurant servers, janitors, and some factory and farm workers. 2. Semi-skilled labor: requires minimal specialized skills and education, such as operation of certain types of equipment. Usually earn an hourly wage. Examples: lifeguards, short-order cooks, and some construction workers. 3. Skilled labor: requires specialized skills and training to do tasks such as operating complicated equipment. Skilled workers need little supervision and usually earn an hourly wage. Examples: auto mechanics, bank tellers, plumbers, chefs, carpenters, and firefighters. 4. Professional labor: demands advanced skills and education. Usually white- collar workers who receive a salary. Examples: managers, teachers, bankers, doctors, actors, and professional athletes.

10. + Wages and Discrimination: In the 1960s, Congress passed anti-discrimination laws that had an enormous impact on society and the economy. The Equal Pay Act of 1963, declared that male and female employees in the same workplace performing the same job had to receive the same pay. The Civil Rights Act of 1964 had Title VII that forbids job discrimination on the basis of race, sex, color, religion, or nationality. (Religious institutions and some small businesses are exempt from the law.) Under this Act the federal government started enacting affirmative action laws. The use of policies, programs, and procedures to ensure the inclusion of minorities and women in job hiring, college admission, and the awarding of government contracts. To enforce these provisions, the Civil Rights Act of 1964 created the Equal Employment Opportunity Commission (EEOC). The EEOC handles complaints of job discrimination. If necessary, it takes companies to court to force them to comply with the law.

11. + Wages and Discrimination Continued: Despite these protections, women today earn only about 75% of what men earn!! Social Conditions that contribute to this earnings gap: 1. “Women’s Work” 2. Human Capital: less productive? 3. Women’s career paths Glass Ceiling: The unofficial invisible barrier that prevents some women and minorities from advancing to the top ranks of business. Minorities and Wage? Minorities tend to earn lower pay then whites do. Income differences are sometimes caused partly by productivity differences. Less access to education and work experience Discrimination can account for this difference in earnings. Denied entrance into higher-paying jobs.

12. + Wages and Unions: Union members tend to earn higher wages than nonunion workers in similar jobs. Union members are also far more likely to enjoy benefits such as pensions and medical insurance. Do unions lower the wages of nonunion workers? 1. Unions press employers to raise their members’ wages 2. When wages go up, the quantity of labor demanded goes down. Thus, the number of union jobs decreases. 3. As union jobs are cut, more workers are forced to seek nonunion jobs. 4. An increase in the supply of available nonunion workers causes the wage rate for nonunion jobs to fall. Featherbedding? Some unions negotiate labor contracts that keep unnecessary workers on the company payroll. Railroads.