Grade Booster student workshops are back in cinemas for 2022. Learn more


Student Videos

Elasticity of Labour Supply (Labour Markets)

AS, A Level, IB
AQA, Edexcel, OCR, IB, Eduqas, WJEC

Elasticity of labour supply measures the extent to which labour supply responds to a change in the wage rate in a given time period

Wage elasticity of labour supply

  • The wage elasticity of supply of labour is the sensitivity of the supply of labour to a change in the wage rate.
  • This is affected by the specific skills and educational requirements: the more complicated the skills and the higher, or longer to achieve, the qualifications required, the more inelastic the supply.
  • If the role has a significant vocational aspect, such as nursing, individuals are less sensitive to changes in pay making the supply more elastic.
  • The time period under consideration is also a factor affecting the supply: in the short run, the supply curve of labour tends to be inelastic as it takes time for people to respond to changes in relative wages.

Boston House,
214 High Street,
Boston Spa,
West Yorkshire,
LS23 6AD

Tel: +44 0844 800 0085

© 2021 Tutor2u Limited. Company Reg no: 04489574. VAT reg no 816865400.