Labor Market Senario
The scenario I have chosen that would cause shift in labor supply and demand is the health care industry. In today’s news and classified advertisement qualified nurses, medical biller, physicians, and doctors are required in health care industry.
Shortage of licensed registered nurses, licensed assistant nurses, direct care workers, home health and personal care aid, physician work force, dental work force and medical assistant work force are the area some of the employment that caused the shift in labor supply in health care industry. Few of the reasons for the shift’s occurrence are increase in population through birth rate and immigration, increase in group of old age people, advancement in technology that has increased the survival of severely ailing and injured.
Many of these occupations have been increasing in demand for many years, and projected to grow because of the fast growing population and technology. According to Wallis (2006), “Nursing shortages are expected to increase from 6 percent in 2000 to 29 percent by 2020”. As a result, the labor demand will increase and shift to the right and labor supply might decrease and shift to the left by the year 2020.
On the equilibrium of the labor market, the shift in health care industry will effect negatively unless some adjustments are made to increase the supply. Increase in wage for the areas of employment will encourage people to archive training and join the employment in many fields of health industry. If the labor supply increase with high wage offered will eventually balance the labor supply and labor demand on the equilibrium of the labor market.
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