L ABOR Chapter 9

L ABOR M ARKET T RENDS Section 1

T RACKING THE L ABOR F ORCE Bureau of Labor Statistics (BLS) They assemble information about the labor force. The labor force is all the nonmilitary people employed or unemployed.

E MPLOYMENT At least 16 years old Worked 1 hr for pay within last week. Worked 15 hrs without pay for family business, farm. Held job, but did not work due to illness, labor disputes, or bad weather.

U NEMPLOYMENT Anyone who does not meet the previous criteria are considered unemployed.

T HE B UREAU OF L ABOR S TATISTICS Location (summer 2008)Unemployment Rate Elkhart-Goshen 5.0 ↓ Indianapolis 4.1 ↓ Lafayette 4.1 ↓ LocationUnemployment Rate United States 5.5 ↑ Elkhart-Goshen14.8 Dec Indianapolis8.5 Lafayette8.6 Chicago 11.6 ↑ United States 9.7 Feb. 2010

O CCUPATIONAL T RENDS A changing economy Started as agricultural, then became industrial, and has now begun to transfer into a service industry country.

Occupational Trends A huge increase in usage of computers on jobs.

E FFECTS OF I NTERNATIONAL C OMPETITION Many factory and other low-skill jobs have moved outside of the U.S. because of the lower wages and less benefits they can pay foreign employees.

E FFECTS OF I NTERNATIONAL C OMPETITION What would some of the effects of this be? Think supply and demand

T HE C HANGING L ABOR F ORCE People used to have secure 40 hr a week job and retire around at age 65. Today people usually work 4-5 jobs and frequently retire earlier.

C OLLEGE G RADUATES Takes money to invest in your individual human capital, as a result your wages will be higher in the long run.

T HEORIES A BOUT E DUCATION Learning effect: the theory that education increases productivity and results in higher wages. Screening effect: the theory that the completion of college indicates to employers that a job applicant is intelligent and hardworking.

W OMEN AT W ORK Many more women have entered the labor force percent of women age were employed.

Temporary Workers Increase as temporary and part-time jobs, these are known as contingent employment. People just brought in for short term and released, even some professional jobs

T RENDS IN W AGES AND B ENEFITS Earnings up for some, down for others. Average weekly earnings have gone down since 1980 from $241 to $222( when accounting for inflation. A $19 decrease. Does not account for added fringe benefits we have today. College grad incomes actually up, low-skilled down.