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Problems faced due to flexible labour …

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Problems faced due to flexible labour laws

    • Posted by Mr. Dhairya?? Gupta 5 years, 11 months ago

    CBSE > Class 10 > Social Science
    • 1 answers

    Yogita Ingle 5 years, 11 months ago

    1. Lack of training. Part-time and temporary staff may not get sufficient training from firms because they only have short-term contracts. A firm has less incentive to develop their worker’s human capital if they are only short-term. Therefore many low skilled workers will remain under-skilled because they never gain job stability and the training this encourages
    2. Lower productivity. Due to less investment in workers, it can adversely affect labour productivity – a key determinant of long-term economic growth.
    3. Flexible labour markets create greater job insecurity and stress. Job security is often as important to workers as the level of wages. This insecurity could lead to lower morale and lower productivity for the firm in the long-run
    4. Rising inequality. Non-unionised part-time workers get smaller pay increases. Arguably flexible labour markets have created a bigger gap between those ‘insiders’ with secure job contracts, and those ‘outsiders’ without job contracts.
    5. Higher search costs for workers needing to find new jobs. Also, firms may have higher replacement costs for hiring more workers. Firms may end up paying a premium to employment agencies to help fill gaps in their workforce.

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