View the step-by-step solution to: The Bureau of Labor Statistics showed an astonishing 5 percent

The Bureau of Labor Statistics showed an...
This question was answered on Apr 08, 2012. View the Answer
The Bureau of Labor Statistics showed an astonishing 5 percent gain in productivity in 2001’s fourth quarter. Some argued that technology had again made the economy more productive than ever before. White-collar workers are more likely to argue that the gains have been made on their backs. The recession’s layoff survivors bitterly point to the various schemes management has employed to get them to work harder for less money.

· Longer hours. It is estimated that 20 percent of the workforce spends more than 49 hours a week on the job – mostly professional and white-collar workers.

· Reclassifying workers as managerial. Class action suits charging that firms are misclassifying jobs to skirt overtime pay are on the rise.

· Loading up on temporary workers. The ranks of temps grew 56 percent during the boom years – a just-in-time workforce that receives no severance pay and no benefits. The temps have been the fastest growing segment of employment in 2002.

· Making less do more. Firms are shrinking the workforce without reducing workloads. They are also forcing employees to work harder to increase sales.

· Shifting risk. Pay is increasingly tied to company performance. That saves money when profits disappear while spurring harder work.

This is all well and good for the present but what happens when the economy rebounds? The spectre of tight labor markets in the future coupled with the feeling of exploited workers with long memories, does not auger well for those firms who are seeking enhanced profits right now.

Source: Michelle Conlin, “The Big Squeeze on Workers,” Business Week, May 30, 2002, p. 96.

Questions:

1. Does this case illustrate the law of diminishing marginal productivity?

2. In this case, less and less of a single factor, labor, is being used. Does this have anything to do with the law of diminishing marginal utility?

3. Does the case distinguish between long-run and short-run profits?

4. Does the case distinguish between long-run and short-run production costs?

5. If you were an employee of one of these companies, what would your behavior be when the economy turned for the better?

Write your answers in a paper of no fewer than 500 words.

Submit this assignment to your instructor using the Assignment Dropbox labeled "LP5: Big Squeeze."
View the entire interaction

Dear Student Please find attached solution of your assignment. Regards View the full answer

Economics-8080658.doc

The Bureau of Labor Statistics showed an astonishing 5 percent gain in productivity in 2001s
fourth quarter. Some argued that technology had again made the economy more productive
than ever before....

Why Join Course Hero?

Course Hero has all the homework and study help you need to succeed! We’ve got course-specific notes, study guides, and practice tests along with expert tutors and customizable flashcards—available anywhere, anytime.

-

Educational Resources
  • -

    Study Documents

    Find the best study resources around, tagged to your specific courses. Share your own to gain free Course Hero access or to earn money with our Marketplace.

    Browse Documents
  • 890,990,898

    Question & Answers

    Get one-on-one homework help from our expert tutors—available online 24/7. Ask your own questions or browse existing Q&A threads. Satisfaction guaranteed!

    Ask a Question
  • 890,990,898

    Flashcards

    Browse existing sets or create your own using our digital flashcard system. A simple yet effective studying tool to help you earn the grade that you want!

    Browse Flashcards