Labor Force Who is employed, unemployed and uncounted!
Labor Force • Def. All nonmilitary people who are employed or unemployed. Also known as the workforce.
So, Who is employed? • You are considered employed if: – 16 yrs or older and… – Worked at least one hour for pay within the last week or… – Worked 15 or more hours without pay in a family business or… – Held a job but did not work due to illness, vacation, labor disputes, or bad weather.
Okay, so who is unemployed? • You are considered unemployed if… – You are 16 yrs or older, not institutionalized, not working and meet one of the following criteria: – Temporarily laid off from their jobs – Will report to a new job within 30 days – Are not working but have looked for work in the last 4 weeks.
So, what if I don’t fall into any of those categories? • Millions of Americans are not counted as part of the workforce. They include: – Military Personnel – Institutionalized individuals (prison, hospitals) – Retired workers – Stay at home parents – Children, students – People who have given up looking for jobs! (hidden unemployment)
Equal Pay and Wages • The workforce is supposed to treat all workers equally – Equal Pay Act of 1963 and Title VII of the Civil Rights Act of 1964 declare EVERYONE in the same workplace, performing the same job had to receive the same amount of pay. Age, gender, race, ethnicity, etc. should NOT matter.
But… • Despite these protections, American Women earn about 75% of what men earn. • Racial minorities tend to earn lower pay than white Americans as well.
Other barriers to women and minorities The “Glass Ceiling” • Some qualified women and minorities find that they cannot advance beyond a certain level in companies they work for. They cannot reach the white, male-dominated top level positions. • The unofficial, invisible barrier that prevents some women and minorities from advancing to the top ranks of business is called the Glass Ceiling.
Trends in the workforce Fewer Goods and More Services • The United States is shifting from a manufacturing economy (making goods) to a service economy (providing services). • As service jobs increase, the nation is losing manufacturing jobs. • Demand for skilled labor is rising, and the supply for skilled workers is increasing to meet the demand: ie. More students going to college because there are few jobs without a college degree.
Trends in Wages and Benefits Earnings up for some, down for others. • Earnings for college graduates have increased, while earnings for workers without college degrees have decreased. • So, not only are jobs for people without college degrees fewer, they pay less than they used to!
Why are College Grads worth so much? Two theories: • The Learning Effect: education increases productivity and results in higher wages. Or, what you learn in school that makes you better at your job. • The Screening Effect: the completion of college indicates a job applicant is intelligent and hard-working. It doesn’t matter what kind of degree, just having one shows you are smart and hardworking, therefore earn more money.
Skill Levels Jobs are categorized into the following groups. In general, wages increase as the skill level increases: 1. Unskilled Labor: requires no specialized skills, education, or training. Ex. Waiter, messengers, janitors 2. Semi-Skilled Labor: requires minimal specialized skills and education. Ex. Fork -lift operator, Truck Driver
Skill Levels 3. Skilled Labor: Requires specialized skills and training. Ex. Auto mechanic, plumbers, carpenters. 4. Professional Labor: Demands advanced skills and education. Ex. Lawyers, Doctors, Engineers, Teachers
Trends in Wages and Benefits Costs of Benefits Rises • Benefits are retirement pension, health and dental insurance, severance, etc. • Rising costs of benefits for workers have caused employers to cut back on benefits for employees and hire temporary employees instead.
Benefits of Temporary Employment 1. Flexible work arrangements 2. Easy discharge due to the lack of severance pay (payment for being fired) 3. Paid less and receive fewer benefits than full-time employees 4. Some employees prefer temporary arrangement (students working summers, part-time workers, etc. )