Grade 11 Economics

For Mrs. Wilson's Grade 11 Economic Education class.
Written by Sean Weeks: Web site:  email/msn

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Module 3

Human Resources

3.1 Establish the relationship between human resources and production.

What is the labour force?

1. The labour force is everyone 15 years of age and older who are working or is considered to be seeking employment.
2. People who are self-employed are part of the labour force.
3. People who collect unemployment benefits (U.I.C.) are part of the labour force as they are considered to be seeking employment.
4. People on strike, sick leave, maternity leave or vacation are also part of the labour force.

Who are not considered part of the labour force?

People who are not considered to be part of the labour force are those who are:

a) less than 15 years of age
b) retired;
c) in the air forces
d) full time students
e) homemakers
f) volunteer works
g) living on Indian reserves or in the territories
h) welfare recipients

What are some of the characteristics of the Quebec's labour force?

1. Approximately 50 percent of the population is in the labour force.
2. Proportionally, more men than women are in the labour force; however, women are entering the labour force in increasing numbers.
3. Generally, the higher the level of education and training, the higher the salary.
4. Approximately five percent work in the primary sector (fishing, mining, logging), exploiting natural resources.
5. Approximately 25 percent work in the secondary sector (manufacturing, construction).
6. Approximately 70 percent work in the tertiary sector (services such as sales and banking)
7. Generally, the higher the level of education and training, the greater possibility of being promoted.
8. Generally, the lower level of education and training, the greater level of unemployment.

What is unemployment?

The unemployed are those who are without work but who are considered to be actively seeking work.

What is the unemployment rate?

The unemployment rate is the percentage of the labour force that is unemployed. For example there are 10 million people in the labour force and there are one million unemployed people, the unemployment rate is 10 percent.
Unemployment rate=1 million/10 million * 100 = 10%

What is the participation rate?

The participation rate is the percentage of the population 15 years of age and over that is in the labour force.
Participation rate = 10 million / 15 million * 100 = 66.6%

What are the different types of unemployment?

There are four types of unemployment:
a) seasonal unemployment, which is the loss of jobs due to seasonal conditions (ski hill operators)
b) structural unemployment, which is the loss of jobs due to new technology (robots replacing assembly line workers)
c) cyclical unemployment, which is the loss of jobs due to a recession or depression;
d) frictional unemployment, which is the loss of a job temporarily due to the time it takes to get a new job.

What can be done to combat unemployment?

Government use several measures to combat unemployment:
a) giving subsidies to businesses;
b) educating and retraining workers;
c) spending on public works
d) giving equalization payments to regions with high unemployment.
(N.B. The fiscal and monetary policies that affect unemployment will be discussed in Modules V and VI.)


What influences the cost of labour?

The cost of labour is affected by:
a) the supply and demand of labour
b) the levels of education, training, skill, experience and responsibility of workers;
c) sex; women are often paid less than men, but this is slowly changing;
d) unionization; union members tend to receive better salaries and benefits than workers who are not unionized
e) governments; which can maintain or improve salaries and benefits through legislation (minimum wage);
f) the geographic isolation, danger or unpleasantness of a job can increase wages.

3.2 Describe the structures and mechanisms of the labour system.

3.2.1 What is a union?

A union is a certified organization of workers who, through their union, are able to negotiate their wages, working conditions and benefits with their employer.

What are the characteristics of union membership?

1. Approximately 30 percent of Quebec and Canadian workers are unionized
2. There are more unionized workers in the public sector than in the private sector.
3. The manufacturing, construction and mining industries are heavily unionized.
4. The service sector tends not to be unionized.
5. Male workers tend to be more unionized than female workers.

3.2.2 How are unions structured?

1. Any employees has the right to start a union
2. A union certificate can only be granted after a secret ballot and when the majority of workers have agreed to be represented by that particular union.
3. Once certified, a union has the legal right to negotiate a collective agreement, which sets out the salaries and conditions of employment. A collective agreement is often called a contract.

How are unions organized?

1. Union organizations in the workplace are called locals.
2. Most locals are part of a provincial, national or international union.
3. In Quebec, a provincial union is called a central.
4. Some unions are affiliated with a national congress or with federations that do not take a direct role in negotiations but act as a political pressure group on governments.

How are labour contracts negotiated?

The negotiating process proceeds in stages:
a) The union prepares it's demands, which are agreed to  by the members, it presents these demands to the employer.
b) After these demands have been deposited with the employer, the employer gives the union an offer.
c) After the presentation of both the demands and the offer, negotiations begin between both sides and continue until a collective agreement has been reached.

What happens if the union and the employer cannot reach an agreement?

1. To force an employer to agree to its demands, a union may:
a) work to rule, which means that rules are followed to the letter and production slows down
b) strike, which means they withdraw their labour and production steps
c) set up picket lines
2. To force a union to accept its offer, an employer may lock out its workers, which means they will no longer be able to earn a wage. Quebec law forbids employers to use replacement workers (scabs) during a strike.

What other methods can be used to reach an agreement?

1. Both sides may  seek an injunction (court order) that may prevent:
a) working to rule
b) picketing by the union
c) a lockout by the employer
2. The government may appoint a mediator or conciliator to resolve the differences with the agreement of both sides. This person may only suggest solutions to solve the dispute.
3. Both sides may agree to have an arbitrator whose decision is final and binding on both parties.

What could happen if a union and an employer cannot agree to a contract?

There is a possibility that the plant could be permanently closed and the jobs transferred elsewhere.

What are the contents of a collective agreement (labour contract)?

Collective agreement contain:
a) clauses concerning pay;
b) regulations concerning fringe benefits; such as pensions and cost-of-living allowances. (COLA)
c) regulations concerning working conditions, such as the length of the day and safety and health provisions;
d) procedures for hiring, lay-offs and promotions
e) government procedures, which are needed to settle disputes that arise as a consequence of an interpretation of the contract. Sometimes grievances are referred to a lab court for a binding decision.


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