FACTORS THAT DETERMINE THE DEMAND OF LABOUR

FACTORS THAT DETERMINE THE DEMAND OF LABOUR

Demand for labour refers to the number of workers or people employers are willing to offer jobs and retain in employment at a given wage rate.

Or It is demand derived from the demand for the product’s labour is required to produce.




Factors that determine the demand for labour

  • The level of demand for a product that labour helps to produce.
  • The level of wages or price of labour.
  • The level of skills of labour.
  • The availability of co-operant factors, for example, land, capital, etc., complement labour.
  • The proportion of the cost of labour to the total cost of production.
  • The possibility of substituting labour for other factors of production.
  • The amount of output of labour (the productivity of labour).

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