Supply and Demand for Labor

A professional degree used to be a guarantee of social mobility and prestige, but the current labour market pays little for some of them.

Tuesday, October 15, 2013

The labor market can be compared to the commercial market. Salaries are defined by the evolution of supply and demand. When supply is greater than demand, salaries are lowered and when demand is greater than supply, wages rise.

The labor market supply and demand

By Egor Espinosa
Country Manager at ManpowerGroup

The labor market can be compared to the commercial market. Salaries are defined by the evolution of supply and demand. When supply is greater than demand, salaries are lowered when demand is greater than supply, wages rise .

The principle of competition is present in all markets and acts the same way in the labour market and when there is oversupply, success is possible only if an individual stands out as the best in their professional field, because otherwise they run the risk of being relegated and receiving a below average salary.



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It is becoming more common for companies to ask that those who aspire to a management or leadership position have a Master's degree. Another important factor when hiring is an age range of between 25-35 years and that they have experience.

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