1.1 Background of the Study Labour economics seeks to

 1.1 Background of the Study Labour economics seeks to understand the functioning anddynamics of the markets for wagelabour. Therefore, wagelabour is defined as delivery of services by person for payment. Wage labour is the socioeconomic relationship between a worker and an employer, where the worker sells his or her labour power under aformal or informal employment contract.

These transactions usually occur in a labourmarket where wages are market determined. A labour market isthe place where workers and employees interact with each other. In the labourmarket, employers compete to hire the best, and the workers compete for thebest satisfy job. A labour market in an economy functions with demand andsupply of labour. In this market, labour demand is the firm’s demand for labourand supply is the worker’s supply of labour.

The supply and demand of labour inthe market is influenced by changes in the bargaining power. The viewpoint thatthe entire economically active population (the employed plus the unemployed)are participants in the labor market has become widespread among domestic laboreconomists in recent years (Kotliar, 1998). In the past two decades, active labourmarket policies have been widely adopted in developed capitalist countries,especially OECD countries, to combat unemployment and economic inactivity  (Chris et al., 2013). Inthe mixed economic situation, both of the public sector and private sectorconduct in the labour market.

Theprivate sector is the part of a country’s economic system that is run byindividuals and companies, rather than the government. Most private sector organizationsare run with the intention of making profit. The segment of the economy undercontrol of the government is known as the public sector and also that portion of an economic system that iscontrolled by national, state or provincial, and local governments.

privatesector is larger in free enterprise economies, such as the United States, inwhich the government imposes relatively few restrictions on businesses. Labourmoving is more comprehensive in understanding when comparing movement ofemployment one to another. Labours who work in privatesector attempt to move from the private sector to public sector or vice versa. Sectorswitching is de?ned as when people move from the private to the public sectoror vice versa. (Bozeman and Ponomariov, 2009). Sector switching is of greatrelevance to our understanding of public and private differences (Bozemanandand Ponomariov, 2009). Which is an area with a lot of studies, but little consensuson ?ndings (Baarspuland and Wilderom, 2011). Most studies on sector switchinghave focused on the motives and consequences of switching from the private tothe public sector (Bozeman and Ponomariov, 2009; Su and Bozeman, 2009).

Thisresearch focus on to identify the movement of public sector to private sector. The thinking of switching from thepublic sector to the private sector then the usual considerations of pay, joblocation, the fit with career goals and the reputation of the potential employerare some of the issues that will be evaluating (Kotila, 1998).                Labour Profit maximization High standard of Service   Private sector Public sector    Labour     Figure 1.1      Flow of the WorkersSource: Constructed by theresearcher  Themain objective in the private sector is Profit maximization.A process that companies under go to determine thebest output and price levels in order tomaximize its return.The company will usually adjust influential factors suchas production costs, sale prices,and output levels asa way of reaching its profit goal.There are two main profitmaximization methods used, and they are marginal costand marginal revenue methodand total costand total revenue method. Profit maximization is a good thing for a company,but can be a bad thing for consumers ifthe company starts touse cheaper products ordecides to raise prices.

The resources available to maximize their profit and the firms haveopened until they have profited.  Alsothe private sector reduces their redundant labours. But in the public sector donot concern about the profit and always attempt to do high standard of serviceto the society.There are some factors to motivate the labour movements and it can behappen in two ways. The push method which refers the factors affect to pushlabours from the private sector to the public sector. On the other hand thefull method manipulates to full labours from public sector to the privatesector. The factors influencing to push method are working hours, number ofholidays, debt for labours, etc. and the factors influencing to full method arewage, ethics in the companies, efficiency and etc.

Publicservice motivation was not a signi?cant factor in sector choice for theunemployed workers, compared to the employed workers who cited the jobusefulness to society as a reason to join the public sector employment (Jin,2013).            The labor movement mayrepresent as follows. PSLM refer public sector labourmovement and pslm refer private sector labourmovement.1.     More labors may move from theprivate sector to the public sector.

           PSLM> pslm2.     More labors may move from thepublic sector to the private sector.           PSLM< pslm3.

     Labours moving in the public sector may equal to labor, moving in theprivate sector.             PSLM = pslm Labour welfare is also a  keyconcept in the labour market. Labour welfare refers the  living standard of labours. The benefits ofthe workers also depend on the labour welfare. There is a difference in benefits of labours in the public sector andprivate sector.

In order that labour welfare or livingstandard refers people may be happy in their work, these three things areneeded: They must be fit for it; they must not do too much of it; and they musthave a sense of success in it (Ruskin, 1898). Labour welfare is understood tomean “such services, facilities andamenities, which may be established in, or in the vicinity of, undertakings toenable persons employed there in to perform their work in healthy and congenialsurroundings and to provide them with amenities conducive to good health and goodmorals” (Joshi,1977). Welfare of a labour gives as several meanings. Such as in absolutelevel we think living standard is our income.

Satisfaction with life is anindicator of a person’s wellbeing, where respondents subjectively assesswhether they are generally satisfied with the way their lives have turned out (Beuningen, 2012). Though a labour who get low income and he highly satisfy withhis life or the job, he has higher living standard than high income labour.Therefore, welfare determines not only the income. But also comfort, wealth,material goods, etc. The term living standard has typically focused onmaterial wellbeing and the definition of living standard is the degrees ofwealth and material comfort available to a person or community (Oxford Dictionary, 2011). According to the Cambridge dictionary living standard is the amount of money and comfort peoplehave in particular society.

And also living standard of a life is the level of wealth, comfort, material  goods and necessities available to a certainsocioeconomic class or a certain geographic area. The standard of living in aeconomy includes factors such as income, gross domestic product, nationalincome growth, economic and political stability, political and religiousfreedom, environmental quality, climate and safety. The welfare is often used to compare geographic areas, such as standardof living in the united states versus Canada or the standard of living inSt.Louis versus New York. In my view welfare of a labour depends on wage,efficiency, working hours, the number of holidays, debt for labours, wealth,comfort, material goods, job satisfaction, Job security, ethics in companies,etc. Therefore, these factors affect to the difference of welfare betweenpublic sector and the private sector. Welfare can defined as the quality of alabour and it depends on efficiency in private sector and public sector. The benefits in publicsector as follows: Helpthe community – As someone whose salary  is being  funded by  taxpayers , a sense of responsibility to thecommunity is instilled in public sector workers.

The flip side of this is that,can directly effect local areas, or even the nation, for  the      good through the quality of the work.   Jobsecurity – Job stability is often referenced as a majorperk in this sector.  The public sector is relatively stable, and whilstprofit-based companies are prone to closure, public sector organizations havethe stability of government-backing. Workingatmosphere – In terms of the atmosphere at work, thepublic sector is less demanding than the private sector.

The cut-throat natureof work in a private company can be stressful. And, although the standards ofwork in the public sector are high, there isn’t the obvious competitivenessoften found in the private sector. Flextime –Government organizations are quite accommodating when it comes to recognizingthe different circumstances of its employees. Flexible working hours are common– usually based around a core time of hours, or on a ‘shift work’ basis.Part-time jobs and job sharing can be also found in the public sector.

 Stafftraining schemes – Public sector organizations arecommitted to realizing the potential in their staff. Employees are oftenencouraged, if not required, to improve their skills set by attending trainingprograms, or attaining external qualifications. This can lead to further careeropportunities. Pensionscheme – Although there has been some furor over publicsector pensions lately, having a guaranteed pension scheme tied into the job isa CHAPTER ONEINTRODUCTION 1.

1 Background of the Study Labour economics seeks to understand the functioning anddynamics of the markets for wagelabour. Therefore, wagelabour is defined as delivery of services by person for payment. Wage labour is the socioeconomic relationship between a worker and an employer, where the worker sells his or her labour power under aformal or informal employment contract. These transactions usually occur in a labourmarket where wages are market determined. A labour market isthe place where workers and employees interact with each other.

In the labourmarket, employers compete to hire the best, and the workers compete for thebest satisfy job. A labour market in an economy functions with demand andsupply of labour. In this market, labour demand is the firm’s demand for labourand supply is the worker’s supply of labour. The supply and demand of labour inthe market is influenced by changes in the bargaining power. The viewpoint thatthe entire economically active population (the employed plus the unemployed)are participants in the labor market has become widespread among domestic laboreconomists in recent years (Kotliar, 1998). In the past two decades, active labourmarket policies have been widely adopted in developed capitalist countries,especially OECD countries, to combat unemployment and economic inactivity  (Chris et al., 2013). Inthe mixed economic situation, both of the public sector and private sectorconduct in the labour market.

Theprivate sector is the part of a country’s economic system that is run byindividuals and companies, rather than the government. Most private sector organizationsare run with the intention of making profit. The segment of the economy undercontrol of the government is known as the public sector and also that portion of an economic system that iscontrolled by national, state or provincial, and local governments. privatesector is larger in free enterprise economies, such as the United States, inwhich the government imposes relatively few restrictions on businesses. Labourmoving is more comprehensive in understanding when comparing movement ofemployment one to another. Labours who work in privatesector attempt to move from the private sector to public sector or vice versa. Sectorswitching is de?ned as when people move from the private to the public sectoror vice versa. (Bozeman and Ponomariov, 2009).

Sector switching is of greatrelevance to our understanding of public and private differences (Bozemanandand Ponomariov, 2009). Which is an area with a lot of studies, but little consensuson ?ndings (Baarspuland and Wilderom, 2011). Most studies on sector switchinghave focused on the motives and consequences of switching from the private tothe public sector (Bozeman and Ponomariov, 2009; Su and Bozeman, 2009).

Thisresearch focus on to identify the movement of public sector to private sector. The thinking of switching from thepublic sector to the private sector then the usual considerations of pay, joblocation, the fit with career goals and the reputation of the potential employerare some of the issues that will be evaluating (Kotila, 1998).                Labour Profit maximization High standard of Service   Private sector Public sector    Labour     Figure 1.1      Flow of the WorkersSource: Constructed by theresearcher  Themain objective in the private sector is Profit maximization.A process that companies under go to determine thebest output and price levels in order tomaximize its return.The company will usually adjust influential factors suchas production costs, sale prices,and output levels asa way of reaching its profit goal.There are two main profitmaximization methods used, and they are marginal costand marginal revenue methodand total costand total revenue method. Profit maximization is a good thing for a company,but can be a bad thing for consumers ifthe company starts touse cheaper products ordecides to raise prices.

The resources available to maximize their profit and the firms haveopened until they have profited.  Alsothe private sector reduces their redundant labours. But in the public sector donot concern about the profit and always attempt to do high standard of serviceto the society.There are some factors to motivate the labour movements and it can behappen in two ways. The push method which refers the factors affect to pushlabours from the private sector to the public sector. On the other hand thefull method manipulates to full labours from public sector to the privatesector. The factors influencing to push method are working hours, number ofholidays, debt for labours, etc. and the factors influencing to full method arewage, ethics in the companies, efficiency and etc.

Publicservice motivation was not a signi?cant factor in sector choice for theunemployed workers, compared to the employed workers who cited the jobusefulness to society as a reason to join the public sector employment (Jin,2013).            The labor movement mayrepresent as follows. PSLM refer public sector labourmovement and pslm refer private sector labourmovement.1.     More labors may move from theprivate sector to the public sector.           PSLM> pslm2.     More labors may move from thepublic sector to the private sector.

           PSLM< pslm3.     Labours moving in the public sector may equal to labor, moving in theprivate sector.             PSLM = pslm Labour welfare is also a  keyconcept in the labour market.

Labour welfare refers the  living standard of labours. The benefits ofthe workers also depend on the labour welfare. There is a difference in benefits of labours in the public sector andprivate sector. In order that labour welfare or livingstandard refers people may be happy in their work, these three things areneeded: They must be fit for it; they must not do too much of it; and they musthave a sense of success in it (Ruskin, 1898). Labour welfare is understood tomean “such services, facilities andamenities, which may be established in, or in the vicinity of, undertakings toenable persons employed there in to perform their work in healthy and congenialsurroundings and to provide them with amenities conducive to good health and goodmorals” (Joshi,1977). Welfare of a labour gives as several meanings.

Such as in absolutelevel we think living standard is our income. Satisfaction with life is anindicator of a person’s wellbeing, where respondents subjectively assesswhether they are generally satisfied with the way their lives have turned out (Beuningen, 2012). Though a labour who get low income and he highly satisfy withhis life or the job, he has higher living standard than high income labour.Therefore, welfare determines not only the income. But also comfort, wealth,material goods, etc. The term living standard has typically focused onmaterial wellbeing and the definition of living standard is the degrees ofwealth and material comfort available to a person or community (Oxford Dictionary, 2011).

According to the Cambridge dictionary living standard is the amount of money and comfort peoplehave in particular society. And also living standard of a life is the level of wealth, comfort, material  goods and necessities available to a certainsocioeconomic class or a certain geographic area. The standard of living in aeconomy includes factors such as income, gross domestic product, nationalincome growth, economic and political stability, political and religiousfreedom, environmental quality, climate and safety. The welfare is often used to compare geographic areas, such as standardof living in the united states versus Canada or the standard of living inSt.Louis versus New York. In my view welfare of a labour depends on wage,efficiency, working hours, the number of holidays, debt for labours, wealth,comfort, material goods, job satisfaction, Job security, ethics in companies,etc. Therefore, these factors affect to the difference of welfare betweenpublic sector and the private sector.

Welfare can defined as the quality of alabour and it depends on efficiency in private sector and public sector. The benefits in publicsector as follows: Helpthe community – As someone whose salary  is being  funded by  taxpayers , a sense of responsibility to thecommunity is instilled in public sector workers. The flip side of this is that,can directly effect local areas, or even the nation, for  the      good through the quality of the work.   Jobsecurity – Job stability is often referenced as a majorperk in this sector.  The public sector is relatively stable, and whilstprofit-based companies are prone to closure, public sector organizations havethe stability of government-backing.

 Workingatmosphere – In terms of the atmosphere at work, thepublic sector is less demanding than the private sector. The cut-throat natureof work in a private company can be stressful. And, although the standards ofwork in the public sector are high, there isn’t the obvious competitivenessoften found in the private sector. Flextime –Government organizations are quite accommodating when it comes to recognizingthe different circumstances of its employees.

Flexible working hours are common– usually based around a core time of hours, or on a ‘shift work’ basis.Part-time jobs and job sharing can be also found in the public sector. Stafftraining schemes – Public sector organizations arecommitted to realizing the potential in their staff. Employees are oftenencouraged, if not required, to improve their skills set by attending trainingprograms, or attaining external qualifications.

This can lead to further careeropportunities. Pensionscheme – Although there has been some furor over publicsector pensions lately, having a guaranteed pension scheme tied into the job isa substantial perk.  Consider the personal benefits of amove in to the private sector: Many commercial organizations look for newsolutions and ways of working to provide a competitive edge, providingemployees with the opportunity to be creative and contribute their ideas in theprivate sector. Benefits of a labour consider as the welfare of a labour. Thecombination of labour income, job satisfaction, savings of the labours, numberof holidays, housing and transportation take place in identifying the benefitsof a labours.   perk.

 Consider the personal benefits of amove in to the private sector: Many commercial organizations look for newsolutions and ways of working to provide a competitive edge, providingemployees with the opportunity to be creative and contribute their ideas in theprivate sector. Benefits of a labour consider as the welfare of a labour. Thecombination of labour income, job satisfaction, savings of the labours, numberof holidays, housing and transportation take place in identifying the benefitsof a labours.