-
Best of luck to the class of 2024 for their HSC exams. You got this! Let us know your thoughts on the HSC exams here -
YOU can help the next generation of students in the community! Share your trial papers and notes on our Notes & Resources page
what is a wage explosion?? (1 Viewer)
- Thread starter unfold
- Start date
Will Hunting
Member
What's the context? Taken as they are, a wage explosion would mean a wage blowout, or a wage rise (probably universal) and wage pressure would simply mean a push for greater buoyancy of wage levels. You're probably hanging out for something more than this, though, so let me know where your question's coming from.unfold said:
more specific...hmmm
hey will hunting, sorry for being so vague... i guess i wasnt sure what i was looking for... but now i've come across this many times, let me try this:
if there is rising unemployment then it might lead to wage explosion? is that so? so in this sense, what does a wage explosion meaN? thanks!
hey will hunting, sorry for being so vague... i guess i wasnt sure what i was looking for... but now i've come across this many times, let me try this:
if there is rising unemployment then it might lead to wage explosion? is that so? so in this sense, what does a wage explosion meaN? thanks!
jonnathann
Member
- Joined
- Aug 28, 2004
- Messages
- 98
i dunno..this mite be that wage and inflation spiral..but yeh mayb it's when there's inflation -> employees push for wage rises -> cost-push inflation -> blah blah?
Rafy
Retired
- Joined
- Sep 30, 2004
- Messages
- 10,719
- Gender
- Female
- HSC
- 2005
- Uni Grad
- 2008
Wage explosion = Massive increase in wages.
This will cause an upward pressure on inflation. Businesses will also find it hard to pay the increased wages, resulting in lower output and a contribution to lower economic growth.
This will cause an upward pressure on inflation. Businesses will also find it hard to pay the increased wages, resulting in lower output and a contribution to lower economic growth.
If you're after inflation reasons you would look at cost-push inflation - largely union activity in pushing up wages in expectancy of inflation (which will just lead to a wage and inflation spiral)
If you're after unemployment reasons you could look at there being less skilled workers in the workforce which may lead to those left demanding higher pay (as there is a lower supply and increased demand). But normally unemployment is due to factors such as oncoming recession or economic downturn which means that employers are unlikely to go around handing out pay increases, as they're trying to minimise costs by laying off workers... so that's a tough one, I'm not sure.
If you're after unemployment reasons you could look at there being less skilled workers in the workforce which may lead to those left demanding higher pay (as there is a lower supply and increased demand). But normally unemployment is due to factors such as oncoming recession or economic downturn which means that employers are unlikely to go around handing out pay increases, as they're trying to minimise costs by laying off workers... so that's a tough one, I'm not sure.
black_man
Chuck lives here
- Joined
- Jun 17, 2004
- Messages
- 201
- Gender
- Male
- HSC
- 2005
I'm not exactly sure about this, having not completed the entire course yet, but i feel rising unemployment might be an indication of a downturn in the economy, meaning productivity is decreasing, and with high levels of unemployment, the supply of labour is increased (relative to it's demand by business), whereby placing downward pressure on wages. I think for there to be a wage explosion which is probably a large increase in wages) there would perhaps need to be rising productivity levels, output and domestic demand, which would justify an increase in wages. so yeah, i'm not sure whether rising unemployment can ensue drastic wage rises, although perhaps a number of people before me would have much more ability to deduce a more logical sort of answerunfold said: