Wages, skills and labour-market shifts
| English | 中文 | Pinyin |
|---|---|---|
| trade union/treɪd ˈjuːnɪən/ | 工会 | gōng huì |
| derived demand/dɪˈraɪvd dɪˈmænd/ | 派生需求 | pài shēng xū qiú |
A decision you can investigate
- A new order for bicycles leads workshops to recruit mechanics. A training college later qualifies more mechanics.
- Product demand and the supply of skills can move the labour market separately.
Build the explanation
- Labour demand is derived from demand for what workers produce. Higher productivity can make workers more valuable, while machine substitutes may change the demand for particular tasks.
- Labour supply depends on population and migration, age patterns, retirement and school-leaving ages, participation (including female labour-force participation), qualifications and geographic/occupational mobility. Quantity and quality matter: many available workers may not yet have the required skills.
Work through the evidence
- With labour supply unchanged, greater demand for bicycle mechanics tends to raise equilibrium wages and employment. With labour demand unchanged, more qualified mechanics shifts supply right: employment tends to rise while wage pressure eases.
- Education and training develop human capital. A trade union 工会 can collectively negotiate wages, hours and working conditions. Better conditions may support retention; disputes can interrupt production. Effects depend on bargaining power, labour-market conditions and the employer’s ability to respond.
What shifts labour supply rather than causing a wage movement along it?
A larger skilled workforce changes labour availability at each wage.
With supply unchanged, a rise in labour demand tends to cause
The new intersection lies up the existing labour-supply curve.
A larger population always supplies exactly the skills each employer needs.
Skills, participation and mobility determine who can fill particular jobs.
Test the limits
- A shift in product demand is not an automatic increase in every occupation’s wages. Training takes time and qualifications must match jobs.
- A higher wage can attract more workers along labour supply; population or qualifications can instead shift the curve. Union gains need evaluation alongside employer costs, working conditions and possible employment responses.
Which can explain a skills shortage despite many job seekers?
Occupational mismatch can limit effective labour supply.
Apply and explain your answer
- Why is mechanics’ labour demand described as derived demand 派生需求?
- Employers hire mechanics partly because customers demand bicycles and related services.
Match the terms to their meanings.
Each term describes a specific mechanism in this lesson.
Use the terms precisely
- derived demand: Demand for an input arising from demand for the output it helps produce.
- trade union: An organization representing workers in employment negotiations.
With labour supply unchanged, greater demand for bicycle mechanics tends to raise equilibrium wages and employment. With labour demand unchanged, more qualified mechanics shifts supply right: employment tends to rise while wage pressure eases. Education and training develop human capital. A trade union can collectively negotiate wages, hours and working conditions. Better conditions may support retention; disputes can interrupt production. Effects depend on bargaining power, labour-market conditions and the employer’s ability to respond.
A shift in product demand is not an automatic increase in every occupation’s wages. Training takes time and qualifications must match jobs. A higher wage can attract more workers along labour supply; population or qualifications can instead shift the curve. Union gains need evaluation alongside employer costs, working conditions and possible employment responses.
Labour demand is derived from demand for what workers produce. Higher productivity can make workers more valuable, while machine substitutes may change the demand for particular tasks.