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Labour market flexibility

Say how labour market flexibility helps firms and employment, and what it can cost workers

Key terms
Labour market flexibility
Labour market flexibility is how easily the number of workers and hours, the tasks workers do and the wages they are paid can change as demand changes.
Employment protection
Employment protection is the set of legal rules, such as notice periods and redundancy pay, that make it costlier for firms to dismiss workers.

Kinds of labour market flexibility

Can you name three kinds of labour market flexibility?

Each lets a firm respond to demand in a different way.