Labor is one of the most influential factors in today’s global market. Cost and availability of labor directly affect the supplier or producer’s ability to manufacture their products. When a producer wants to sell a product in the market they first have to go through the production process and produce the actual product. This is where labor comes in; labor is defined as the work that is produced by human beings and to produce and sell a product, employees are needed. The more a producer plans to produce and sell, the more employees and labor they need. Supply and demand of labor rely on the perceived demand of the product that is being sold, as demand for the product increases, the demand for labor (employees) increases to be able to produce the products. This means that an …show more content…
The elasticity of demand of labor depends on the elasticity of its output, if there are substitutes or other options demand will be elastic, if substitutes are more expensive and the employees’ wages do not form a big percentage of the total wages then demand will be inelastic. Demand can be described as the relationship between the price and the quantity required for a particular good or service in a given circumstance. For each price offered, the relationship of the order will tell the quantity that customers want to buy at a similar price. The quantity that customers want to buy at a certain price is called quantity demanded. The important thing to do is to distinguish demand from quantity. To explain this concept, buyers are people who want or need a product or service. The term "demand" refers to the desire and ability of customers to purchase goods or services in the market. The relationship of demand reflects the readiness and ability of the full range of