The Labor Market – Efficiency and Mobility of Labor
Efficiency of Labor is the ability of Labor to increase output without increasing the quantity of Labor. Increase in efficiency is usually expressed in terms of increase in output of Labor within a shorter period of time without any fall in the quality of goods and services produced. If labor is efficient, the quality of goods and services produced will be high.
There are lots of recommendations to consider when trying to improve efficiency of Labor. Such ways are as follows:
Education and training: The level of education and training received by a worker will go a long way towards increasing the efficiency of labor. A well educated or well trained worker is in position to increase efficiency in his work.
Level of technology: High technology will increase the efficiency of labour.
Efficient management: High technology will increase the efficiency of labor.
Personal skill of the worker: If a worker possesses a natural skill of doing a particular job, his work becomes efficient.
Attractive wages: When the salary or wage of a worker is attractive, it will boost or promote the efficiency of the worker.
Weather condition: The physical or weather conditions in a work place can affect the efficiency of labor. Hot weather lowers efficiency of labor, cool weather or environment increases efficiency of labor.
State of health of worker: A healthy worker is more likely to be more efficient than a worker who is sicker.
Efficiency of other factors of production: The efficiency of other factors of production like land, capital and entrepreneur when combined with efficient labor will increase productivity.
Intelligence of the workers: Some workers are highly intelligent, while others are not. Highly intelligent workers rarely make mistakes.
Conditions of service: An improved condition of service like the availability of transport allowance, bonuses, overtime, etc. will help boost efficiency of labor.
Application of division of Labor: The application of division of labor and specialization in any organization can result in the efficiency of labor.
Level of commitment and attitude: The level of commitment and attitude of a worker can affect the efficiency of labor, when a worker can affect the efficiency of labour. When a worker is highly committed to his job, this will result in efficiency of labor.
Security of job: Efficiency of labor can be increased if a worker is sure that his job is secured.
Promotion: frequent promotions of workers in any organization can lead to increase in efficiency of labor.
Mobility of Labor
This is the ease with which labor can move from one geographical area to another; or from one occupation to another. Labor is said to be mobile when workers will find it easy to move from one geographical area to another or to change jobs. There are two main types of mobility of labor.
Geographical mobility of labor
Geographical mobility of labor is the ease with which workers or labor can move from one geographical location to another in pursuing the same occupation or changing occupations. When a worker moves from one town to another, eg, from London to Sheffield, without changing the job he is doing, we say that he has moved geographically. An accountant in London may move to Sheffield to continue to work as an accountant. Take note that it is the movement of labor or worker from one area to another area, this is called geographical mobility of labor. Factors affecting geographical mobility of labor are:
1. Cost of transportation: A worker may be able to move from one location to another if the cost of transportation is low. But when it is high, movement becomes difficult.
2. Accommodation problems: Workers may not be able to move to new location where there’s accommodation problems.
3. Climatic conditions: Members may move from where there are favorable, climactic conditions.
4. Family and cultural ties: Members of a family or culture may find it difficult to move from one location to another of strong family or cultural ties.
5. Government Policies: Certain government policies which can help to deliberately move labor to different states other than their states of origin.
6. Social and economic infrastructures: The availability of social and economic infrastructures eg, electricity, pipe borne water, telecommunication etc, do encourage labor to move to places where these infrastructures are available.
7. Discrimination: Labor may not be able to move if there is the possibility of discrimination against them in their destination.
8. Language barrier: When Labor finds it difficult to speak the language of a particular area, it becomes very difficult for them to move to such area.
Occupational mobility of Labor
This is the ease with which a worker or labor moves from one occupation or job to another. When a musician becomes a footballer, he has changed his occupation. Factors affecting mobility of labor are as follows:
1. Cost and length of training: Some professions are expensive to train in terms of time and money, e.g, the medical profession.
2. Ability or aptitude: Some jobs require natural ability or talents and those that are not gifted can not fit into such jobs e.g a musician.
3. Employment prospect/age: After a certain age (eg, 45 years) employers will not engage such people. They have poor prospects for an employer as they only have short working Life.
4. Trade union/professional association restrictions: Some professional bodies (e.g accounting, law) require certain qualifications before admission.
5. Personal reasons: Personal preference for a particular job and dislike for available alternatives may discourage movements.
6. Families and friendly ties: Friendly ties at times make it difficult for some people to change jobs. Also, some families are known to be associated with certain profession, and it will become difficult for a family member to pull out of that profession.
7. Political instability/religion: When there is political instability or religious crises, it will be very difficult for labor to move.
8. Wage rate: Labor will move if there is a wide margin in salaries but if it is low, labor may not move.
9. Condition of service: Apart from salary, the conditions of service in a working place eg bonuses, overtime, staff bus, car and housing loan etc. When present, will encourage labor to move.
10. Discrimination: There may be discrimination of sex, color, age, religion etc. This can affect occupational mobility of labor.
Efficiency and mobility of labor are very vital pillars in a nation’s or region’s economy. They can stabilize or decline the rate of development of a region.