Factors That Influence The Demand for Labour
- The labour market is composed of sellers of labour (households) & buyers of labour (firms)
- Workers supply their labour & firms demand labour
- Workers supply their labour & firms demand labour
- The demand for labour is a derived demand
- This means that it depends on the demand for goods/services
- If demand for goods/services increases then the demand for labour will increase - and vice versa
- If demand for goods/services increases then the demand for labour will increase - and vice versa
- This means that it depends on the demand for goods/services
Factors That Influence The Demand for Labour
The price of the product being produced |
The demand for the final product |
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The ability to substitute capital (machinery) for labour |
The productivity of labour |
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