The Economic Effects of Labour Market Failures

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    The Economic Effects of Labour Market Failures

    • Labour market failures can result unemployment, skill shortages, and workers in the wrong jobs
      • This increases a firm’s costs of production and reduces consumer surplus
    • On a macro scale, in reduces the firm’s international competitiveness and has an adverse effect on the country’s trade position.
    • Inefficient labour markets also raise governmental costs in terms of state benefits, legislation, and spending on education, training and regional policy

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