Possible Reasons for a Change in the Size of a Country’s Labour Force

Topics: Inflation, Unemployment, Economics Pages: 7 (2340 words) Published: October 20, 2011
Q1 Explain the possible reasons for a change in the size of a country’s labour force The labour force of a country is defined as the total number of workers who are available to work. Therefore it refers to all males and females, normally 15-16 years and over, who can contributed to the production of goods and services. As well as those actually in employment, it also includes those who are unemployed as these people are available for work. A change in the labour force would normally be a slow process over time and could come about because of:

• a change in the labour force participation rate as a result of a change in the number of young people of working age remaining in education; alternatively, more could decide to seek work rather than stay in education.

Not only has the balance of the labour force changed between the sexes, it has also changed by age as table 5 shows. Since 1971, there has been a significant increase of 16-24 year old workers peaked in 1989 at 5.6 million and has since the mid 1990’s. Part of the reason for these changes has been demographic. The number of births increased the end of second world war to the mid 1906s.They then fell to 1978, rose again to 1990, fell to 2002 and are now rising again. These rises and falls create bulges of workers in the age distribution of the labour force. People born from the end of the second world war in 1945 to the mild- 1960s are called ‘baby boomers’. The fall in the birth rate after the mild 1960s is the key reason why the numbers in work aged 16-24 began to fall from 1989. The baby boomers have gradually pushed their way through the age range of the working population. A worker aged 50 in 2006 was born in 1956, so the numbers of workers aged 50+ can be expected to increase at least until 2015.

millions| 16-24| 25-34| 35-49| 50-64(male)/50-59(female)| 65+ (male)/60+ (female)| 1971| 5.1| 5.3| 7.9| 5.0| 0.6|

1984| 5.0| 5.3| 8.0| 4.9| 0.7|
1994| 3.9| 6.7| 9.3| 4.7| 0.8|
2004| 4.1| 6.3| 10.7| 6.3| 1.0|
2007| 4.2| 6.3| 11.0| 6.5| 1.3|

• a change to the minimum statutory school leaving age
Another factor affecting he numbers in work aged 16-24 has been the growing proportion of particular 16-22 year olds in full time education. At the 50 + end, there have been two factors pulling in opposite directions. One has been a trend towards early retirement, particular seen in the 1990s. The other has been the willingness of the 50 + age group, particular women, to continue working to boost their income. Those today who take early retirement frequently go on do another job, albeit less well paid than their previous job. The combination of a retirement pension job. The combination of a retirement pension plus a lower wage can mean that they are better off financial than if they were in their previous job. The government, in response to poor pension provision in the UK. Is encouraging workers to continue in employment into their 60s. This would allow a smaller number of post- baby boomer workers to support a growing number of baby boomers pensioners. • supply side measures that encourage more women to join the labour force. • a change in net migration of people of working age.

* Employment by ethnic group

In general, the employment patterns of those of non-white origin seem less favorable than those of the white population.

* Employment by industry and region

The supply of workers to different industries and different regions has changed considerably over the past 30 years. Broadly, there has been a major shift of workers from primary and secondary sectors of the economy to the tertiary sector. Consequently , regions heavily dependent upon coal mining and heavy manufacturing saw losses of jobs and population to regions which have traditionally specialized in light...
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