Labor Economics Issues - Essay Example

Labor Economics There are various reasons for wage differences among groups. For the white-collar versus blue collar workers, for example, the main determinant of wage difference is the education and experience. White-collar jobs are given to employees who have achieved higher level of education, more skilled and have been trained better than the blue-collared workers. The difference between the earnings of male and female who have the same level of education can be largely attributed to the child-bearing ad child-rearing role that women fulfill in the household. Expecting that women will go out of the labor force during and after pregnancy, bosses are hesitant to give women the best training possible, which can simply be explained by the cost and benefit analysis. The intermittent attendance of women in the labor force would mean less return for the employer for every training and additional knowledge that it has given a female employee. The lack of training on the part of the women explains this difference in wages. Another inevitable result of the intermittent attendance of women to the labor force is their inability to be promoted to higher position as this would mean greater chaos in the office every time the women leave for child-bearing and child-rearing. The popular books on labor economics agree on this very important explanation for the male-female wage difference. With all other determinants equal, the reason why women are still promoted to lower position and still receive lower salaries than men is discrimination. The gender discrimination is not only observed in large countries like the USA but also in small but booming countries such as the Singapore, particularly observed in the form of pre-existing structural differences, sexism and male protecting their success by excluding women from high-paying jobs (Lee). 2. The comparable worth law is defined as “A theory holding that compensation for job classifications filled chiefly by women should be the same as for those classifications filled chiefly by men if the jobs, albeit dissimilar, are regarded as having equal value. According to this theory, workers salaries should be calculated on a scale of socioeconomic value that transcends traditional supply and demand” (Answers.com). The impetus of the law is to demolish any form of gender discrimination against women. But women having a low salary and coming from a different job than men may not neccesarily be a form of discrimination. What can be seen clearly as discrimination is the unequal pay between male and female with the same human capital. One economist has excellently concluded that the comparable worth law, which by policy increases the salary of some types of women occupation will result to an increase in supply for these types of job, reduce a demand from the employers and eventually create unemployment (Mankiw). The economic benefits of this law might well be dampened by the costs, as more women become unemployed. The question of who are more likely to be affected, meaning who are more likely to be unemployed or experience reduce work hours is of value in this discussion. Obviously, the less educated, less experienced women are more likely to be affected-the minority and the people that we actually wish to support. A long-term effect of this policy is the reduced incentive of women to enroll in courses which gears to high positiion and salary. Comparing for example the salaries of engineers to nurses, if the government deliberately pass a policy increasing the salaries of nurses, women might not totally be interested in enrolling in an engineering course, which can affect their bankability in the future. In order for the government to solidly enforce this law, there will be a need for more law enforcers and this is defenitely and additional expense on the part of the government (Newmark). The comparable worth law began is practiced in some areas outside the United States such as the province of Ontario in Canada. 3. In an article, “An analysis of employment discrimination claims associated with layoffs”, the authors has given inputs into the managers as to how to eliminate discrimination when laying-off workers. It is evident that discrimination happens but the article also suggests that some employers do not and would want to do it deliberately. There are therefore studied characteristics of laying-off workers that reflect discrimination. These “characteristics can highlight the most common of discrimination, and thus help managers intervene to prevent such perceptions” (Slonaker). Furthermore, the author advised that “reduce costs, managers need to know where to devote extra attention and careful communication to reduce even perceptions that layoffs are discriminatory”. The article basically says that the employment discrimination can be present in much of the employment processes, such as hiring, promotion, trainings and even in laying-off workers. As much as possible employers also want to avoid being labeled as doing discriminatory processes as the company also incurs additional costs in this. It is difficult to find examples of discrimination as much of the reasons of the employers to their ways are valid such as differences in human capital and that they are understood to be shooting for the highest profits. Discrimination can in fact reduce the firm’s profit, if they fail to get the best of the pool of available workers just because of bias against certain race or gender. 4. Unemployment rate in the USA rose from 6.1% in September to 6.55 in October. This is translated to 240,000 jobs lost and a total of 1.2 million jobs in the entire 10 months of 2008. Of this, over half of the decrease happened in the last 3 months. This data came from the pronouncement of the Bureau of Labor Statistics of the U.S. Department of Labor. Quoting the data from the website of the Finfacts team, “The unemployment rates for adult men (6.3 percent), adult women (5.3 percent), whites (5.9 percent), and Hispanics (8.8 percent) rose in October. The jobless rates for teenagers (20.6 percent) and blacks (11.1 percent) were little changed. The unemployment rate for Asians in October was 3.8 percent, not seasonally adjusted. ) Among the unemployed, the number of persons who lost their job and did not expect to be recalled to work rose by 615,000 to 4.4 million in October. Over the past 12 months, the size of this group has increased by 1.7 million” (Finfacts Team) Works Cited Answers.com. 2008. www.answers.com. 10 November 2008 . Finfacts Team. "News:International." 7 November 2008. Finfacts of Ireland. 10 November 2008 . Lee, William Keng Mun. "Gender Inequality and Discrimination in Singapore." 1998. www.questia.com. 10 November 2008 . Mankiw, Gregory N. "A Comeback for Comparable Worth ." 5 June 2007. Greg Mankiws Blog. 10 November 2008 . Newmark, Craig. "Some notes on comparable worth." 22 August 2005. Newmarks door. 10 November 2008 . Slonaker, William M. 1 January 2003. allbusiness.com. 10 November 2008 . Read More