Question 3 : What are the advantages and disadvantages of opening labour markets on a global scale?
Date submitted: 22nd January 2015
Course tutor: Michael Gold
MacLuhan (1969) introduced the term “global villages” into the modern management. Forty years later, many companies consider the global instead of their home country as their play field and this implies for the labour market. (Mustafa Ozbilgin (2005) Thus, there are lots of employees, mostly managers and the professionals who work in the home country, sent as expatriates to the host countries as the companies are trying to expand their operations across national borders and as global competitiveness intensifies. (Arthur and Bennett 1995; Drucker (1999) The companies will employ people who are mostly local, host-country nationals and also people who are ‘third-country’ nationals. Some of them may have came from an operation from a host country to work for the company. Moreover, companies will invest in the global leaders for future development who know clearly about the operation of diverse teams and take up the challenge of cross-border mobility (Conner 2000) in order to ensure the global market stay competitive.
Labour market consists of workers who are looking for paid employment and employers are seeking to fill vacancies. Labour supply is determined by the number of people who are in employment or looking for job and the number of hours they are willing to work. Labour demand is the sum of employees plus the number of vacancies waiting to be filled. When sales rise, demand for labour goes up. For instance, there is a rise in the number of nurses in 2010 compared to 1997 due to a government decision to increase spending on healthcare between 2000-2011 and the average annual increase was 6.5 percent. ( Harker 2011) the NHS turned to overseas recruitment in order to response the increasingly rapid demand for nurses, around 10 percent of new nurses were from outside UK in 1990s and 50 percent were international qualified nurses by 2011-2002. (Buchan and Seccombe 2011:16) Recruiting foreign nurses filled the skill gaps without waiting for domestic nurses to be trained and gain experience. Foreign nurses are willing to work in the UK due to better pay and working conditions, career mobility, professional development and better quality of life, sometimes just novelty and adventure. (Kingma 2006) In opposite, when sales fall, demand for labour decreases. (Julie B, Amanda T. 2014) For example: workers who work in HMV lost their job as retailer HMV closed stores. HMV’s like-for-like sales were down 12.1 percent in the financial year 2011-2012 as it failed to stand out in the competition , especially from music downloads. (BBC, 2012 )
Challenges / Disadvantages
There is a challenge in managing a diverse workforce. Dynamic economic growth in Asia and the Pacific driven by increased Asian workers to seek employment abroad every year. Discrimination occurs in the labour market which is an everyday experience for most migrant workers. They are being discriminated in variety of ways in Europe and the Middle East, and also in Asian region itself. Increasing number of migrate workers face new forms of discrimination including racial discrimination, gender, xenophobia, intolerance are all reflected in low wages, long working hours and violence. (International Labour Office. 2012) Gender discrimination indicates an organisational problem. For instance, discrimination on women occurs within their working environments, regardless of their own personal experiences with it may affect them to more negatively assess their organisations and experiences than men do. It has also been said that women generally don't feel included and treated fairly than white men do (Mor Barak, Cherin & Berkman, 1998) which might result poor working performance and low productivity as they do not enjoy their work there. According