labour as a factor of production
labour as a factor of production. labour is a factor of production that refers to all human efforts both physical and mental used in the process of production of both goods and services. A tractor for example contribute physically while a doctor contributes mentally when he prescribes drugs. The reward for labour is wages or salary.
Characteristics of labour
- It is both geographical and occupational mobility of labour.
- It receives a reward for all its services it renders is known as wages or salaries
- It Labour cannot be stored because it loses It value over time when left unused
- It cannot be bought and sold, but only the services of labour can be higher.
- It takes a long time to be trained in order to become more productive
- It can form an associative called trade union
- It consumes what I produce.
The supply of labour.
The supply of labour refers to the number of hours that workers are willing to offer their services for production at a given wage rate.
Factors that influence or affects or determinant of the supply of labour.
- Seize of the total population: everything being equal, the larger the population seize the higher will the supply of labour and the smaller the population seize the smaller will be the supply of labour e.g. Cameroon with a larger population has a larger supply of labour than Equatorial Guinea with smaller population.
- Age composition of the population or age structure: this measures the number of people in the different age groups. A country with a bigger active population will have a higher supply of labour.
- Working weeks and holidays: if the working weeks are increased and the number of public holidays reduced, the supply of labour will be increased.
- Renumeration or wage rate: this is payment made to labour for services rendered an increase in wage rate (renumeration) all things being equal, will lead to an increase in the supply of labour. However when wages rise above a certain level, workers instead preferred to work less and enjoy more leisure.
- Migration: a large proportion of emigrant consisting of the active population turns to reduce to labour force as well as the supply of labour while on the other hand and increase in immigrant who are of the active population turns to increase the labour force.
- Altitude of women towards work: if women are willing to pick up paid jobs the supply of labour will increase. But if they shy away from work, the supply of labour will be low.
- The retirement age: this varies from country to country. An increase in retirement age increases the supply of labour and vice versa.
- Legal age of entry into active service: a reduction in the legal age of retiring into active service leads to a reduction in the supply of labour. But where the age of entry is high the supply of labour increases.