Chapter 8 – Employment, Labor, and Wages
8-3 Labor and Wages
CA Standards:
12.3 Understand the operations of the labor market, including the
circumstances surrounding the establishment of principal American
labor unions, procedures that unions use to gain benefits or their
members, the effects of unionization…
Objectives:
• Identify four main categories of labor.
• Explain the importance of non-competing labor grades.
• Describe two different approaches to wage determination.
Write definition of key terms found on
page 198 Use glossary in textbook
Read pages 198 - 204
Economics: Principles & Practices
Prepare for Open notebook Quiz
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 Key Terms page 194
Unskilled Labor
Semiskilled Labor
Skilled Labor
Professional Labor
Noncompeting Labor Grades
Wage Rate
Traditional Theory of Wage Determination
Equilibrium Wage Rate
Theory of Negotiated Wages
Seniority
Labor Mobility
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Many different occupations exit in the United
States, and wages usually differ from one
occupation to the next. To understand why wages
differ, it helps to place workers into broad groups
so that we can study the characteristics of each.
1. What are the four major labor categories?
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Unskilled
Semiskilled
Skilled
Professional or Managerial
2. What are three reasons why members of one
labor category find it difficult to qualify for
occupations open to a higher labor group?
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Cost of education and training
Lack of opportunity
Lack of initiative.
3. According to the traditional theory of wages,
how are wages determined?
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- through the forces of supply and demand
4. According to the theory of negotiated
wages, how are wages determined?
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- through the strength of organized labor.
5. What are four reasons for wage differences
in different parts of the country?
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Supply and demand
Labor mobility
Cost of living
Attractiveness of location
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notebook quiz