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View Full Version : How does productivity in an industry lead to unemployment


Mommy2one07
Oct 30, 2015, 09:17 AM
How does the productivity in one industry lead to an increase in the unemployment rate within that industry if wages are unable to adjust downward?

Curlyben
Oct 30, 2015, 09:24 AM
What do YOU think ?
While we're happy to HELP we wont do all the work for you.
Show us what you have done and where you are having problems..

Mommy2one07
Oct 30, 2015, 09:30 AM
My confusion begins with understanding the concept of wages adjusting downward

Curlyben
Oct 30, 2015, 09:45 AM
Well what does that imply ?

Mommy2one07
Oct 30, 2015, 10:38 AM
I don't understand why the wage would ever adjust downward. And if it does, what does that mean?

ma0641
Oct 30, 2015, 12:11 PM
I believe it should be productivity INCREASE. Then what happens, lets say new machinery to increase production. Look at the auto industry, robots mostly build cars now, not people.

talaniman
Oct 30, 2015, 07:56 PM
I don't understand why the wage would ever adjust downward. And if it does, what does that mean?

Workers take a cut in pay when profits are down, to keep their job and keep the business going. Again the auto industry is an example during the economic downturn of '07.