labour markets Flashcards
(16 cards)
trade unions in the uk
increased from 5.5 million in 2024 to 6.4 million in 2025
higher wages and more strikes in recent years
pros of strikes
better working conditions, higher wages
more job security
collective bargaining power
cons of strikes
lost wages and benefits
disrupted services
economic impact
damages employer relationships
potential job losses
legal consequences
mental health
pros of trade unions
higher pay
legal protection
job security
stronger collective voice
reduced inequality
career development
social security and benefits
cons of trade unions
monthly membership cost
strikes and lost productivity
may disagree with union actions
might not feel represented
reduced flexibility for employers
higher costs for employers
potential job losses
trade union wage vs monopsony wage rate
the trade union wage rate will be higher
employment rates will be higher
better allocation of resources as monopsony power is reduced
what has monopsony power restricted since covid
public sector pay has been affected as monopsonistic markets pay less than competitive ones
monopsony impact
the one buyer/ employer has all the power so can reduce the price/ wage rate and it has to be taken as there’s no other choice.
stagnant or falling real wages that don’t always keep up with inflation - reduced consumption
gov intervention can exacerbate the impacts when they cap wage rises
monopsony and public sector pay example
the IFS has seen the public sector has performed worse than the private sector in recent years and the average real public sector pay fell by £2k between 2022-23 which monopsony power and gov intervention have caused
why did the tories end the cap on bankers bonuses
to boost the UK’s financial competitiveness and attract highly skilled workers back to London but has caused concerns for increased wage inequality
pros for ending the bankers bonuses cap
enhanced global competitiveness
attracting talented workers
flexibility for banks as they can adjust compensation of performance and market conditions
potential for higher tax revenue
cons for ending the bankers bonuses cap
increased risk taking - potential for another financial crisis
pay inequality
undermining financial stability
ethical concerns - bankers aren’t solely responsible and makes the gap between wealthy and working class larger
labours new working regulations
increased job security and predictability
no more 0 hour contracts
have the right to guaranteed hours
employers need to gibe enough time when changing shifts
flexible working (at home)
switch off after hours
easier to join trade unions
have to report disability and race pay gaps
no more minimum service levels in industries
how the new labour working regulations are good for businesses
increased employe morale and productivity
reduced legal costs
better reputations - attracts more highly skilled workers
how the new labour working regulations are bad for businesses
increased costs - sick pay, no 0 hour contracts
increased administrative burden - HR may need to change their policies to fit the new regs
may not hire as many new employees
disproportionate impact on small businesses
examples of new labour regulations
new employment rights bill - if passed trade union power will increase and so will sick pay
probation periods may change so it’ll be harder for businesses to sack employees who aren’t performing well
