Job Forecast and Me
Today market labor is complex. Great changes have occurred, and changes are inevitable. According to Robert (2004) labor markets in developed economies trends has been characterized by increase in average real wages, increase in wage inequalities and increase in labor mobility. However this has not been the general case in underdeveloped economies.
The labor markets in these economies have been characterized with growth in unemployment, rise in average real wages and increase in wage inequalities. In both economies jobs are created while at the same time others are scrapped off. Labor force development has also become a key issue in our contemporary world. Good trained labor force means high productivity and efficiency in the economy. The creation of job especially for youths has become a worldwide debate. There are different job expectations among the employed, unemployed, job seekers and first time job seekers. This research will examine the issue concerning economics of job creation, labor force development and job expectations with an economist eye.
Economics of job creation
Job creation is the act of offering employment opportunity to the available labor force. The government and private sector have a great role to play in job creation. However much of economic theory should be employed when making jobs creation decisions. Many governments decision towards jobs creation have been under political influence either to please the citizens and political allies or gang political support. Pierre (2006) postulates that that there has been coexistence of job creation and job destruction.
Every job created has its own opportunity cost. The opportunity cost means the best alternative foregone by taking a certain decision. For instance a government may decide to offer soft loans to private sector with viable business ideas to increase employment through private sector. On the other hand the funds could be used in the construction of hospitals and schools which can be used to further the welfare of the community. The welfare foregone is the opportunity cost of the employment creation in the private sector.
Cost benefit analysis should be taken to ensure that any action towards jobs creation leads to the economy being better than before. If cost exceeds benefits then the job creation project should not be implemented. From our case above assume that many skilled workers are dieing due to lack of medication and the estimated cost of training new workers is 3 billion and that the total benefits that will accrue from creation of employment in the private sector amount to 2 billion. Then the project is not worthy of undertaking.
Pierre has also asserted that work sharing as a cure to unemployment is a faulty decision. In fact it reduces efficiency and productivity. Work sharing should be done only when the costs involved is less than benefits accrued. Here, decrease in productivity and efficiency represents some costs which should be factored in.
The process of job creation also involves training. Training is a cost to either the employer or the employee. Concerning training especially in the U.S, John (2007) asserts that training is so essential part of job creation process. In fact, in U.S, temporary help industry have been formed to offer training facilities. The industry provides workers with short term contracts to train them on various skills. At the same time a commission from the fraction workers wage goes to this industry. Secretarial and clerical jobs are the professions which mostly participated in this industry. A skilled worker will definitely produce good results in terms of productivity and efficiency.
The concept of marginal cost and marginal benefit should be utilized. If marginal cost of creating an extra job is less than marginal benefit derived from the labor offered then the labor force is not worthy of employment. In this case marginal cost is measured in terms of wage paid to the additional labor unit. The marginal benefit of a unit of labor can be measured in terms of marginal productivity acquired after employment of the extra labor unit. The process of job creation should not create any disguised unemployment. This is a case where a certain work is being done by more workers than required. This means that marginal productivity of additional unit of labor is less than zero. These also cause congestion in the work place and decrease efficiency and productivity. Just for illustration, suppose in a firm which want to be labor intensive, a certain machine is shared by workers from different departments. The manager decides to create more jobs by employing more labor force. Also suppose that these additional workers will have to use the same machine being shared among the workers of various departments. Workers will have to queue as they wait to be served by the only machine available in the firm. Consequently more time will be wasted and the marginal productivity of extra unit of labor employed will decrease at a decreasing rate. This trend will continue up to zero marginal productivity and then this will turn to be less than zero. This illustration shows that in any decision to create a job there should be proper consideration of the capital and labor balance. Any underutilization of both capital and labor should be avoided under all cost.
The act contracting ones friends and relatives in a firm to secure them from unemployment without any economic consideration can pose a great threat to the firm. It may constitute additional costs which are not counteracted by additional benefits. It is important to note that one of considerations every economist will have is that of improving the welfare of economic agents. An individual will be better off when heshe is employed as opposed to when heshe is unemployed. However every decision to create employment should be economically evaluated to avoid destruction of more jobs than the created ones. These will concur with Paretto Optimality which dictates that any economic decision should not make one economic agent better off while making another economic agent worse off.
However it should be noted that some jobs creation result into destruction of others. This is allowable in the case where the long run anticipated benefits are greater than costs. This is grounded in cost benefit analysis which dictates that if benefits are greater than costs then the anticipated decision is economically viable.
Job creation however has been hindered by some factors under this point lies the topic of labor mobility. Some jobs needs certain skills and their creation must be done only when there is labor force available with the needed skills. A teacher cannot be employed to treat people in absence of a doctor. Immigration restrictions have also hindered job creation. It has become hard for other people to immigrate to some countries and at the same time work there. Immigrants have been a cheaper source of labor. Restriction of this supply may hinder more jobs creation which will be economically viable if cheap labor supply can be available.
Political issues affecting economics of job creation
Andrew (2005) postulate that immigration restriction is employment discrimination. He also proposes the enhancement of guest workers program. On the other hand selfish and misleading political decisions have also led to uneconomical jobs creations whose benefits are far much less as compared to incurred costs.
Social issues affecting economics of job creation
Culture and religion have also hindered job creation. To some communities some jobs are not acceptable while others are meant for certain gender. In the past, technical jobs had not been much taken as women jobs. There was a perception that only men were good in this field. It little bothered women to train or invest in this field.
Labor force development.
Each an every firm will wish to have skilled labor to ensure that efficiency and productivity. Lack of efficiency in a company can hinder the attainment of profit since this tends to increase cost of production.
Labor force development in formal and informal training.
Informal training
This includes training for most manual workers. Apprentice is employed mostly. Trainees are supposed to master skills as they work along already trained workers. The training have no specific set targets of how much the trainee should have acquired certain skills within a specified period. The training depends on how much and what kind of work is available. Many casual laborers in construction sites, vehicle repairing and carpentry usually go through informal training.
Formal training
The largest part of this training is conducted in schools and colleges. Learners are educated on various aspects of their specialization. This training involves learning in terms of theories and practical. Teachers are usually professionals in the areas which they are required to teach. This training involves a plan of how much training should have taken place during a specified time. Formal training is usually of different levels. In many countries it starts in primary school then to secondary school followed by colleges and universities. At university one can be trained up to degree level, masters degree and Doctorate in philosophy (PhD).
Internship constitutes is also a part of formal training. Students from secondary schools, universities and colleges undergo training in real environment where they are being trained to work. For example a student pursuing a degree in education will have to undergo for internship program in a school where he she is supposed to teach on the area of hisher specialization.
Seminars and workshops
Many firms and organization have frequently been organizing seminars to brief their employees on the pertinent development in their careers. Since the world is changing every day with invention of new technologies, there is a need to equip the labor force with needed skills to ensure good performance and productivity. As an illustration it is apparent that almost every industry has embraced the use of computer. This means that workers have at least to be equipped with know how of how to use computers. Besides technological changes, consumer behavior is changing everyday. Taste and preferences are changing day by day. Competition among different firms in the industry is being intensified. There is production of high quality goods and services. All this calls for development of labor force which will thrive through such an environment.
These are some of the reasons that make different firms offer seminars and workshops to their employees to equip them with necessary skills as part of their labor development programs.
Training therefore is a core part of labor development if the economy has to achieve desired degree of productivity and efficiency. According to World Bank (2005) the Millennium Development Goals number eight emphasizes the need for descent and productive work for youths. The labor markets figures in underdeveloped countries are said to be unavailable. Efforts should be gathered to collect these figures to ease job creation plans and labor development.
My job expectations
One of my job expectations is that I will expect to work where my productivity will be more than zero. I also expect to work where my skills will be updated through training which will align with my career expectations of becoming an expert in economics related issues.
Being guided by my research on economics of job creation I would prefer to be self employed and even create more jobs for others. Having understood the economic factors to consider when a job is being created then I believe I can make an informed decision. I will be better off creating more jobs for many unemployed people than when seeking to be employed. I will take pleasure in helping economic agents to make job creation decisions which are grounded on economic theories like cost benefit and marginal analysis.
Conclusion
The act of creating any job should be grounded on strong economic theory. Labor development should also be emphasized by all economic agents if efficiency has to be achieved. Political and social factors which have adverse effect on labor market should not prevail any more.