AN OVERVIEW OF LABOR MARKET Hewi-Lin Chuang, Ph.D. 2014/02/26

Highlights Labor economics studies how labor markets work. Models in labor economics typically contain three actors: workers, firms, and governments. A good theory should have realistic assumptions and can be tested with real- world data. The tools of economics are helpful in answering positive questions.

An Overview of Labor Market Science is built up with facts, as a house is with stones. But a collection of facts is no more a science than a heap of stones is a house. -Jules Henri Poincar’e- Labor Force: All those over 15 years of age who are either employed, actively seeking work, or awaiting recall from a layoff. (The age may vary in different countries. For example, it is 16 years of age for the U.S.) Labor Force Participation Rate: The ratio of the labor force to those of age over 15.

Unemployment: Those in the labor force who are not employed(for pay). Unemployment Rate: The ratio of those unemployed to those in the labor force. This is the most widely cited measure of labor market condition.

Wage Rate: The price of labor per working hour. Wage rate × Units of time worked = Earnings. Earnings + Fringe benefit = Compensation. Compensation + Unearned income (interest, dividends, transfer payments etc.) = Income

(Employed plus Unemployed) Labor Force (Employed plus Unemployed) Layoffs Quits New Hire Recalls Unemployed (Not employed, but looking for work or awaiting recall) Population (Age 15 and over) New Entrants Reentrants Dropouts Retirements Not in Labor Force

§ DEMAND FOR LABOR Product demand Wages, amount of K Choice of technologies Determines number of workers employed Wages Wage Changes: (1) Scale Effect (2) Substitution Effect A demand curve for labor tells us how the desired level of employment varies with changes in the price of labor when the other factors affecting demand are held constant. D # of workers

§ SUPPLY OF LABOR Market Supply: The supply of labor to a particular market is positively related to the wage rate prevailing in that market holding other wages constant. Wages Wages S2 S S1 # of workers # of workers

Wages Supply to Firms: The supply to a firm would be a horizontal line since each firm is a price taker in the competitive labor market . W* # of workers

§ DETERMINATION OF THE WAGES Supply W1：demand exceeds supply W2：supply exceeds demand W*：Market-Clearing Wage W2 W* W1 Demand # of workers

DETERMINATION OF THE WAGES Labor market equilibrium coordinates the desires of firms and workers, determining the wage and employment observed in the labor market.

Wage rates are determined by the market and announced to individual firm. Wages Wages Supply W* W* SA Demand DA # of workers # of workers Market A Typical Firm

人力資源調查 目的：為瞭解民間人力供給情況，凡年滿十五歲具有工作 能力與意願之經濟活動人口，定期予以調查與分析。 創始於民國五十一年四月。 本處查編臺灣地區人力資源統計，係以家庭為對象，透過 抽樣調查，蒐集民間十五歲以上人口之品質、數量、勞動 力結構、就業、失業、失業原因、非勞動力構成等有關基 本資料。

人力資源調查 為應各機關人力資源運用與經社決策施政需要，獲取較為 詳細資料，乃於六十七年至八十年間利用同一樣本附帶舉 辦下列十四種專案調查。 包括：人力運用、工作經驗、住宅狀況、婦女婚育與就業、 傷病醫療與就業、國內遷徙、職業訓練、青少年狀況、老 人狀況、時間運用、國民休閒生活、工作期望、國民文化 活動需要、國民生活型態與倫理等。

重要人力指標 項目別 總計 男性 女性 年度(民國) 經濟成長率(%) 勞動力 (千人) 就業者(千人) 失業者(千人) 勞動力參與率(%) 勞動力(千人) 67 13.49 6337 6231 106 58.76 4250 4183 77.96 2087 2048 39 39.13 68 8.01 6515 6432 83 58.73 4356 4306 50 77.95 2159 2126 33 39.23 69 7.32 6629 6547 82 58.26 4406 4357 49 77.11 2223 2191 39.25 70 6.46 6764 6672 92 57.82 4503 4448 55 76.78 2261 2224 37 38.76 71 3.97 6959 6811 149 57.93 4605 4509 96 76.47 2354 2301 53 39.30 72 8.32 7266 7070 197 59.26 4687 4561 126 76.36 2580 2509 42.12 73 9.32 7491 7308 183 59.72 4778 4661 116 76.11 2713 2647 43.30 74 4.07 7651 7428 222 59.49 4860 4719 141 75.47 2790 2709 81 43.46 75 11 7945 7733 212 60.37 4957 4821 136 75.15 2988 2912 45.51 76 10.68 8183 8022 161 60.93 5065 4966 100 75.24 3118 3057 61 46.54 77 5.57 8247 8107 139 60.21 5130 5043 87 74.83 3116 3064 52 45.56 78 10.28 8390 8258 132 60.12 5231 5149 74.84 3159 3110 45.35 79 6.87 8423 8283 140 52.94 5263 5175 88 73.96 3160 3108 44.50 80 7.88 8569 8439 130 59.11 5355 5274 73.80 3214 3165 44.39 7.56 8765 8632 59.34 5460 5380 73.78 33.4 3252 44.83 6.73 8874 8745 128 58.82 5497 5422 72.67 3377 3323 54 44.89 7.59 9081 8939 142 58.96 5595 5511 84 72.44 3485 3428 58 45.40 6.38 9210 9045 165 58.71 5659 5558 101 72.03 3551 3487 64 45.34

重要人力指標(續) 項目別 總計 男性 女性 年度(民國) 經濟成長率(%) 勞動力 (千人) 就業者(千人) 失業者(千人) 勞動力參與率(%) 勞動力(千人) 85 5.54 9310 9068 242 58.44 5662 5508 154 71.13 3648 3560 88 45.76 86 5.48 9432 9176 256 58.33 5731 5562 169 71.09 3701 3613 45.64 87 3.47 9546 9289 257 58.04 5780 5610 70.58 3767 3679 45.60 5.97 9668 9385 283 57.93 5812 5624 188 69.93 3856 3761 95 46.03 89 5.8 9784 9491 293 57.68 5867 5670 197 69.42 3917 3821 46.02 90 -1.65 9832 9383 450 57.23 5855 5553 302 68.47 3977 3830 148 46.10 91 5.26 9969 9454 515 57.34 5896 5547 348 68.22 4074 3907 167 46.59 92 3.67 10076 9573 503 5904 5579 326 67.69 4172 3994 177 47.14 93 6.19 10240 9786 454 57.66 5968 5680 288 67.78 4272 4106 166 47.71 94 4.7 10371 9942 428 57.78 6012 5753 259 67.62 4359 4190 48.12 5.44 10522 10111 411 57.92 6056 5810 245 67.35 4467 4301 48.68 96 5.98 10713 10294 419 58.25 6116 5868 248 67.24 4597 4426 171 49.44 97 0.73 10853 10403 58.28 6173 5902 271 67.09 4680 4501 179 49.67 98 -1.81 10917 10279 639 57.90 6180 5776 404 66.40 4737 4502 235 49.62 99 10.72 11070 10493 577 58.07 6242 5880 362 66.51 4828 4613 215 49.89 100 4.19 11 200 10 709 491 58.17 6 304 6 006 297 66.67 4896 4 702 194 49.97 101 1.48 11 341 10 860 481 58.35 6 369 6 083 286 66.83 4 972 4 777 195 50.19 102 2.11 11 445 10 967 478 58.43 6 402 6 116 66.74 5 043 4 851 192 50.46