Definition
- Productivity of labour
- The productivity of labour is the output each worker produces, and a better-trained, more productive workforce raises the demand for that labour.
Example
Can you think of an example of productivity of labour?
Employers hire more from a well-trained pool of workers at the same wage, and less from a pool they would first have to spend time and money training.
Test yourself
Can you name three factors, besides demand for the product, that shift the demand for labour?