Chapter Eleven

Labor Forces

McGraw-Hill/Irwin Copyright © 2010 by The McGraw-Hill Companies, Inc. All rights reserved.
 Learning Objectives

 Identify forces beyond management control that

affect the quantity and quality of labor
 Explain the reasons that cause people to leave their
home countries to work abroad
 Discuss why some countries have guest workers
 Explain factors associated with employment policies
including social roles, gender, race, and minorities
 Discuss differences and trends in labor unions
among countries

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 Labor Quality and Quantity

 Quality, quantity, and composition of labor force are of

great importance to an employer
 Labor Quality
 The skills, education, and attitudes of available
employees
 Labor Quantity
 The number of available employees with the
skills required to meet an employer’s business
needs

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 Worldwide Labor
Conditions and Trends
 Overall size and sector of the work force
 International labor trends
 Aging of populations
 Rural to urban shift
 Unemployment
 Immigrant labor
 Child labor
 Forced labor
 Brain drain
 Guest workers
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Primary Occupation of
National Labor Force

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Percentage of the Population
aged 65 or More

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 Unemployment

 3.1 billion workers in 2008 (per UN, ILO)

 200 million overall are unemployed
 Middle East and North Africa (13.2%)
 Sub-Saharan Africa (9.7%)
 Central and Eastern Europe (9.7)
 Latin America and Caribbean (7.7)
 Developed economies (6.7%)
 Southeast Asia and the Pacific (6.1%)
 South Asia (4.7%)
 East Asia (3.8%)
 45% of unemployed are between age 15 and 24
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 Labor Mobility

 Labor Mobility refers to the movement of people from

country to country or area to area to get jobs
 Immigration refers to the process of leaving one’s
home country to reside in another country
 Foreign-born
 Population comprises those immigrants whose
move is permanent and may include taking
citizenship
 Foreign
 Population who are guest workers

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 Nations With the Highest
Number of International Migrants

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 Labor

 Child labor
 The labor of children below 16 years of
age who are forced to work in production
and usually receive little or no formal
education
 Primarily found in developing nations
 Existent in developed countries
 70% are in agriculture
 Forced labor (27 million today) mostly in
 South and East Asia
 Northern and western Africa
 parts of Latin America LO2
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 Brain Drain
 Brain drain refers to the loss by a country of its most
intelligent and best-educated people
 Record numbers of immigrants are moving to
OECD countries in search of jobs
 When skilled workers migrate from developing
countries they do so for professional opportunities
and economic reasons
 Reverse brain drain refers to the growth of
outsourcing and the movement of highly educated,
technologically skilled employees and research
scientists to other countries

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Brain Drain

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 Foreign-Born Individuals
with Science or Engineering Ph.D.

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 Guest Workers

 Guest workers are people who go to a foreign country

legally to perform certain types of jobs
 Guest workers provide the labor host countries need
 Guest workers are desirable as long as the
economies are growing
 When economies slow, fewer workers are needed
and problems appear

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 Considerations in
Employment Policies

 Social Status
 Important with respect to labor force, especially in
some cultures
 Caste: the group to which people belong in a
system under which people’s place or level in a
multilevel society is established at birth as being
the same level as that of their parents
 Sexism refers to the acceptability of women as full
and equal participants in the work force ranges widely
 Worldwide, 59% of all businesses include women
in senior management positions LO4
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 Women’s Education

 Studies show a direct correlation between women’s

education and
 birthrates
 child survival rates
 family health
 a nation’s overall prosperity

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Female Illiteracy

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Women in Parliament

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Maternity Leave

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Ratio of Wages, Woman versus Men,
Selected OECD Countries

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 Racism

 Black and White conflict

 U.S., South Africa, Great Britain and elsewhere
 Arab-, Indian-, or Pakistani and Black conflict
 Africa
 Tamils and Sinhalese Conflict
 Sri Lanka

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 Minorities

 Traditional Societies
 Tribal peoples before they turn to
organized agriculture or industry;
traditional customs may linger after the
economy changes
 Minorities
 A relatively smaller number of people
identified by race, religion, or national
origin who live among a larger majority

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Employer-Employee Relationships

 The labor market refers to the pool of available

potential employees with the necessary skills within
commuting distance from an employer
 A company must study the labor market when
considering whether to invest in a country
 Sources include
 Foreign Labor Trends
 Handbook of Labor Statistics
 Yearbook of Labor Statistics

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 Country Strike Rates
Selected OECD Nations

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 Labor Unions

 European labor
 Identified with political parties and socialist
ideology
 United States labor
 Laborers already have many civil rights
 Collective bargaining
 A union represents the interests of a bargaining
unit (sometimes includes both union members
and nonmembers) in negotiations with
management

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 Labor Unions

 Japanese unions are enterprise-based rather than

industry wide
 Unions tend to identify strongly with company
interests
 Research shows that of all developed country
workers, Japanese workers are the least satisfied
with their jobs

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Labor Union Membership Trends

 Employers have made efforts to keep their

businesses union-free
 More women and teenagers have joined the work
force, low loyalty to unions
 The unions have been successful in raising wages,
which leads to offshoring
 In the knowledge economy, industrial jobs that have
formed the core of union membership are declining

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 Multinational Labor Activities

 Internationalization of companies creates

opportunities for them to escape the reach of unions
 In response, unions have begun to
 collect and disseminate information about
companies
 consult with unions in other countries
 coordinate with those unions’ policies and tactics
 encourage international companies’ codes of
conduct
 Multinational unionism is developing

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 Multinational Labor Activities

 The International Labor Organization (ILO) promotes

social justice and recognizes human and labor rights
worldwide
 The Trade Union Advisory Committee to the OECD
consults on trade union issues in global markets

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Union Membership Across Countries

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