The Impact of Globalization On Labour Markets Essay

The Impact of Globalization On Labour Markets - Essay Example This very fact could be regarded as one important negative aspect of globalisation over the labour market when it allowed for a substantial hike in the wage rates of skilled labour force (owing to premiums over wages) but at the same time increased the difference with that earned by the low-skilled or unskilled group of labour. The present paper is dedicated to a proper examination of the impact that globalisation had over the labour markets across the world with the help of literature background supported by proper empirical evidences. In addition, it also attempts to enlist the functions of the International Labour Organisation and suggests remedies to correct the negative impact that globalisation had over the labour market. Introduction Globalisation had been one of the most significant of all revolutions to have affected human civilisation. It assisted the transmission of resources between nations so that the problems arising out of resource crunch at one location could be easil y tackled. Initially, the procedure had been associated with hefty cross-border duties as well as transaction costs, though these expenses eventually started receding with time. The nature of resources nonetheless had been restricted at the outset, limited only to commodities. In fact, there had been economic concerns which restrained nations from importing or exporting services from their peers. Commodity trade themselves had been associated with a high cost. However, this practice was later discovered as a delusion as the merits of free trade gradually came to the forefront. This kicked off the transfer of human resources across national premises as well. Thus globalisation had a... This essay stresses that globalisation is characterised by a reduction or relaxation in trade tariffs so as to promote international openness thus facilitating free flow of goods and services between nations. This particular aspect had been very beneficial for the global labour market from a number of aspects such as betterment in the wage structure of both skilled and unskilled labour forces than what it had been immediately after the World War. Apart from that there had been a considerable fall in the rate of unemployment around the globe. This is essentially due to the fact that openness has helped people to migrate across international premises so that an excess supply at one corner of the world is compensated by excess demand in another. This paper makes a conclusion that there had been an efficient allocation of factor resources as well in addition to improvements in economic activities which is reflected through betterment in the economic growth rates of nations across the world. Hence, all nations are instigated to add up to their capital stocks which ultimately result to greater factor productivities and shoved up the economic growth rates further. However, the hikes in wage rates were also followed by a rising disparity in the wage rates between groups of skilled and unskilled labours. On the other hand, lack of monopoly now deprived the trade unions of their bargaining powers so that the unskilled labour force was left to loom behind in impoverished living conditions.