Chapter 7 - Defining competitiveness

Labor cost =

(pay level) times (number of employees)

what shapes the external competitiveness?

1) competition in the labor market for people with various skills. 2)competition in the product and service markets. 3) characteristics unique to each organizations

efficiency wage theory

A theory stating that wages influence worker productivity

Which of the following are not relevant labor market competitors

Charles Schwab and Gold's Gym

The supply side theory that suggests that workers compete for jobs with established wages is

Job competition theory

Which pay level policy is most likely reduce the ability to attract employees, reduce labour costs and contribute to pay dissatisfaction?

LAG

External competitiveness refers to the __________ of one organization's pay to that of its __________ .

Relationship; competitors

Companies often set different pay level policies for different job families.

TRUE

When the supply of labor is not responsive to changes in pay, product market competitor data are likely to be weighted more than labor market competitor data.

TRUE

marginal product of labor

The additional output a firm produces as a result of hiring one more worker

External competitiveness

The pay relationships among organizations - the organizations pay relative to its competitors

If you were seeking a job, which of the following is most likely to offer the highest pay?

a large (over 500 employees) petroleum company

bourse

a market that allows haggling over terms and conditions until an agreement is reached.

A company can achieve external competitiveness by setting pay levels _____ that of competitors.

above, equal to, OR Below

The demand side of the labor market looks at

amount of pay employers are willing to pay their employees

Pay forms

are various types of payments, or pay mix, that make up total compensation.

The concept underlying marginal product is _________

constant factors of production lead to diminished productivity with additional hires

A compensation mix is

different percentages allocated to base, bonuses, benefits and options

If an employer wanted reduce turnover, use fewer supervisors and have less "screwing around" by employees, following which wage theory would be most likely to achieve these goals?

efficiency wage

) Which of the following pay policies are most likely to attract, retain and contain labor costs

employer of choice

The four basic assumptions that begin most labor market theories include all EXCEPT _____.

employers always seek to maximize profits, pay rates reflect all costs associated with employment, markets faced by employers are competitive. people are not homogeneous and therefore not interchangeable CORRECT

Competitiveness policy affects the compensation objectives of

fairness, compliance, efficiency

An organization becomes known as an employer of choice because it _____

has a reputation as a good place to work

Other things being equal, the higher the pay level, the

higher the labor costs

marginal revenue of labor

is the additional revenue generated when the firm employs additional person with other production factors held constant

A non-unionized company may use a_____ to ensure employee satisfaction with pay, attract new employees and head off unions.

lead policy

Conventional policies that establish pay-level policies include all EXCEPT _

level policy

The additional output from hiring one additional production worker (with other production factors held constant) is

marginal product of labor

Which of the following is not a labor demand theory?

matching

A reservation wage is the ______.

minimum wage job seekers will accept

organizational factors that influence pay level and mix decisions include all EXCEPT _____.

organization size,industry, employee preferences provincial and federal regulations CORRECT

Business strategy, technology and productivity and experience of the work force are factors that influence _____.

pay-level and pay-mix decisions

Under the human capital theory, a ____ is paid more than a _____

person with a college degree; person without a college degree

Pay level

refers to the average of the array of rates paid by an employer, Base + bonuses + benefits +value of stock / number of employes

In which of the following pay-mixes are bonuses and options the smallest?

security or commitment

Which of the following theories is most similar to establishing a brand for a product or service?

signaling

The three factors usually used to define the relevant labor market for a particular job include all of the following EXCEPT _

skill and knowledge, willingness of workers to relocate, commute or become virtual employees, nationwide averages of labor market rates other employers in the same product/service and labor market CORRECT

Quoted price

stores that label each items price or ads that list a jobs opening starting wage are examples of quoted markets

A study of graduating college students found they were looking for all but which of the following?

team-based pay

utility theory

the dollar value created by increasing revenues and/or increasing costs by changing one or more human resource practice.