This website uses cookies to ensure you have the best experience. Learn more

The Effects Of Inflation On The Labor Market

799 words - 3 pages

Objective: The effect of inflation on the job market
The Effects of inflation on the Job Market
     In the major industrial countries, low unemployment usually creates inflationary pressures. But during the recent economic expansion in the United States, prices have held steady despite low unemployment. Inflation is generally defined as an upward directional increase in the average of prices. Most people tend to be concerned about it because it reduces the purchasing power of the income earned by households. Though a few exceptions most commodities accentuate to this general assumption, all other things being equal. On the contrary the job market is a database of positions available for either a specific profession or the pool of potential applicants nation wide. With the use of visual aid and extensive explanations I will relate the connection between inflation and the Job market in America.
     Inflation is caused by increasing the quantity of money used in purchasing a fixed amount of goods. This could also happen by reducing the number of goods available for a fixed “nominal” amount of money. On both sides money is subjected to it’s intrinsic relevance. Meaning peoples expectation of return varies when tendering a barter object.
     In mutualism, the job market consists of all available positions available to all individuals sixteen years and above who are willing and able to work. In a deeper context the basic component of the job market is the minimum wage. The minimum wage is the lowest hourly salary that an employer is allowed to pay an employee for services rendered. The Federal Labor board sets the minimum hourly labor rates. The lowest hourly rates are decided by a collective bargaining, an arbitration and a board action legislation. Minimum wage laws were passed to ensure that employees are reasonably compensated. However exceptions to this include volunteer services, family businesses and of recent C.E.O.’s like Steve Jobbs who earns an annual salary of only 99 cents but receives millions in other gratuities
The Philips Curve
THE PHILLIPS curve is the negative empirical relationship between inflation and the unemployment rate--has long been a mainstay of market and policy analysis of inflation in the United States. Macroeconomic forecasters and policymakers alike have relied on the Phillips curve to provide a reading of the likely path for inflation in the period ahead. In the past few years, however, the Phillips curve seems to have become less reliable. The unemployment rate has fallen in the 1990s, but the expected subsequent increase in inflation has not occurred. Some have attempted...

Find Another Essay On The effects of inflation on the labor market

Conditions and Effects of the Evolving Electronic Economy on Labor

3603 words - 14 pages Conditions and Effects of the Evolving Electronic Economy on Labor “But I think what surprised me as much as anything was not to find any stores on Washington Street, or any banks on State. What have you done with the merchants and bankers? Hung them all, perhaps, as the anarchists wanted to do in my day?” “Not so bad as that,” replied Dr. Leete. “We have simply dispensed with them. Their functions are obsolete in the modern world.” (60

Labor Unions and Effects on the Lives of Factory Workers

783 words - 3 pages Organized labor, during the period from 1875-1900, had drastic effects on the lives of factory workers. Labor unions not only sought to improve working conditions; they wanted to have a large impact on society as a whole as well. These unions also altered feelings toward organized labor. The Industrial Revolution that took place after the Civil War made for a more economically sound country. American workers, however, were becoming more and

Effects of the 2005 budget on economic activity, price stability, economic growth, full Employment and inflation

943 words - 4 pages threshold for the 42 per cent and 47 per cent rates will be raised on 1 July 2005 and again on 1 July 2006. The Government will also abolish the superannuation surcharge on contributions and termination payments made or received on 1 July 2005.Inflation has been contained in recent years, reflecting moderate growth in unit labor costs, the effects of a higher exchange rate and strong competition in the retail sector. The Consumer Price Index (CPI

The Effect of Commodity Prices on Inflation

2117 words - 9 pages the full effects of commodity prices on inflation.. 2.3 Gold Prices on Inflation Commodities such as oil and gold are often seen as an inflation hedge; they are bought on the market to protect against the devaluation of money. This is because it is expected that the asset will maintain or increase in value. However, they are also considered to be inflation indicators. Therefore, it is important to consider how such variables influence

The effects of inflation and defaltion in revolutionary France

2019 words - 8 pages detailing what inflation is and will explain how it came about and its effect in Revolutionary France in the period 1789-1796. In 1796 war was declared against the empire, there followed a period of blockades and collapse of French colonial trade these times were accompanied by marked deflation. In the second part of this essay I will be discussing the causes of this deflation and its effects on France.In order to answer this question we must

The Effects of Organized Labor on the Position of the Worker

1011 words - 4 pages Karen Joy Castillo1/10/07AP US HistoryPeriod 3The Effects of Organized Labor on the Position of the WorkerIn the late 19th Century, there were significant changes in American industrialization and in attitudes towards work. As improved technologies and machines in the industries took away the need for skilled workers, the new industrial workplace called for workers who had little or no experience, known as wage slaves. Wage slaves had little

The Meaning of Inflation

1549 words - 6 pages political decision Britain will have to make in the first half of the twenty-first century. It could lead to greater prosperity, lower inflation, more jobs and greater national influence. On the other hand, it could lead to higher unemployment, failing businesses and a loss of national sovereignty. Pro-euro and anti-euro arguments not only discuss the effects on business, the economy and our sovereignty, but on personal finances

The Effects of Market Failures

2048 words - 8 pages The Effects of Market Failures Innovation has a crucial impact on the standards of living in particular economy. It is generally agreed that research and innovation are the main sources of growth and job creation in market economies. i.e. output is increased through greater acquisition of knowledge. Subsequently, 2 things matter for economic growth: savings and the state of the productive knowledge (i.e. shows how

Inflation and effects on Australia

1743 words - 7 pages . Some of these imports are part of the regimen of the CPI. If importers pass on the increase in their costs, prices will rise, thus resulting in inflation. There are also two possible causes of inflation. Governments can implement various government policies that have an affect on inflation. For example, the imposition of the GST. Also, when an increase in the money supply outstrips the growth rate of the economy, the increased volume of money

Rethinking of the Graduation Inflation

1130 words - 5 pages Sibo Yang Basic Writing 3 Mrs. Schroeder 5-15-2014 Rethinking of the graduation inflation The current society witnesses the prosperity of various kinds of ceremonies and graduations. It seems that the end of every stage, every moment, and every period needs a ceremony to declare that it is finished! Considering that weird phenomena, the regular essayist for Time Magazine Amy Dickinson wrote an essay “Graduation Inflation” to present her views on

Outsourcing and the US Labor Market

1684 words - 7 pages &hid=106>. Stephanie, Armour. "Outsourcing critics cite labor laws in other nations." USA Today n.d.: Newspaper Source. Web. 9 Mar. 2014.< http://eds.a.ebscohost.com.gatekeeper2. lindenwood.edu/ehost/detail?sid=ca8f1347-1e04-4d9c-aed3-f1dc97593a6d%40 sessionmgr4002&vid=5&hid=4208&bdata=JnNpdGU9ZWhvc3QtbGl2ZQ%3d%3d#db=nfh&AN=J0E317291521204>. Wood, Joel. "The Effects Of Environmental Regulation On The Competitiveness Of US Manufacturing." Fraser

Similar Essays

Recession's Effects On The Labor Market

1174 words - 5 pages PN productivity rises significantly, it will increase the growth rate of the gross domestic product (GDP) with larger increases with productivity, which pushes employers at that point to hire more workers to accommodate expected demand. Wages will increase but if labor productivity rises at a rate faster than the increase in wages, then the rate of inflation and unemployment will drop. Micro economic theory of market structure and unemployment

The Impact Of Globalization On The Kenya Labor Market

969 words - 4 pages edge to enjoy tremendous market powers: monopoly or oligopoly on the supply side, and monopsony or oligopsony on the demand side (Blue Hippo).” Due to the inefficiency of the system it was even more difficult for Kenya to gain ground in the global economy and thus their economy became impaired which in turn negatively impacted the evolution of their labor market. Globalization To fully understand the impact of globalization on the Kenya labor

The Effect Of Globalization On The Labor Market

2094 words - 8 pages industrialized countries.Although immigration into a labor scarce country increases total income in the nation, it does not necessarily increase per capita income, because the population grows. If the immigrants are unskilled and bring little or no capital with them, they are likely to lower US or European per capita output. Only if we do not count the new arrivals as part of the population, and focus only on he original residence, is that issue

"Labor Market Institutions And The Effect On The Labor Force."

4293 words - 17 pages the only labor market institution variable which consistently had a significant positive coefficient in this study. In addition, the coefficient on the employment protection legislation variable was consistently positive and significant, but the implied effects on unemployment differ substantially. The same is true of the union density variable, although most of the IFM study found that union density either had no effect or even a negative effect