Why do firms alter labour hours just before employment?

Type :

Case study

Pages :

4 pages

Format :

.doc

Published date :

05/09/2008

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Summary :

 
 

Table of Contents Why do firms alter labour hours just before employment? Table of Contents

 
  1. Introduction
  2. Choosing the amount of labour services
  3. The asymmetry between hiring and firing
  4. The most common instance of changing the hours worked by employees
  5. Taking on new workers
  6. Conclusion
  7. Bibliography

Abstract

The model of labour demand in terms of hours worked by employees assumes that firms instantly adjust their employment when the economic environment or business cycle changes. A firm looking to change the size of its work force will always find that it is costly to make spontaneous changes to its labour force. A firm firing a large proportion of its workers, for example, will in most cases suffer some costs when the experience and knowledge of these workers disappear from the work environment. Differently, a firm wishing to expand employment or increase hourly working hours (this maybe due to a rise in output price) will find that hiring additional workers might be equally costly: the firm will have to process the job applicants through the personnel office and train new workers.

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About the author :

pencil image Sunmade A. research
Level :Advanced Study : Accounting School/University : westminster

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