Tag Archives: Labor Day

Labor Day: Trade and Immigration

minersOne of the basic concepts of economics is that the production of goods and services are a product of both capital (equipment) and labor (the work to turn raw material into finished goods or to provide the services).  Some industries are what economists call “capital intensive” — meaning that relatively speaking it takes a lot of capital to purchase the equipment needed to operate (think the automobile industry).  A capital intensive industry is difficult for new competitors to enter.    Other industries are labor intensive — meaning that it takes little to capital to purchase the basic equipment and labor is the main input (think almost any profession).  The only restrictions on entering these industries is any licensing requirement for workers.   The degree to which an industry is capital intense (and how much skill the labor requires) in turn has an impact on the degree to which it is vulnerable to foreign trade and immigration poses a threat to existing workers.

Posted in Economy, Holidays | Also tagged , Comments Off on Labor Day: Trade and Immigration