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What is Labor Mobility?

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  • Written By: Mary McMahon
  • Edited By: O. Wallace
  • Last Modified Date: 11 September 2016
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Labor mobility refers to the ease with which people can take advantage of new economic opportunities. When labor mobility is high, there are few barriers to changing jobs and when it is low, people may encounter obstacles which make it difficult to take on new employment. Higher labor mobility is generally believed to be better for the economy as well as workers, but there are also some drawbacks which can be created by high mobility.

There are a number of perspectives from which one can view labor mobility. Labor mobility itself is affected by several different facets. The first are systemic elements such as occupational training, demand for workers in a given industry, and education level. People who are well educated and highly trained experience more work opportunities, in contrast with people with low skills. Personal elements such as ability to relocate also play a role; people may not be able to move because they have difficulty selling a home, do not want to uproot their children, or cannot afford the costs associated with moving. These two issues have an impact on ability to take new jobs, but people must also have the desire to find new work. If they do not, there is no reason to seek out and take advantage of fresh job opportunities.

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Labor mobility can occur both within and between economies. Some nations, for example, are famous for welcoming international workers, experiencing a high level of international labor mobility, while in other cases it may be difficult for people to move between economies. It can be geographic or occupational in nature; someone who relocates to a different country for work is demonstrating geographic mobility, while someone who transitions from one type of job to another is benefiting from occupational mobility.

Ideally, labor mobility is vertical in nature, meaning that people move up the employment ladder rather than staying static with horizontal mobility. Someone who moves from restaurant to restaurant as a bus boy, for example, is stuck in horizontal mobility. By contrast, someone who becomes a bus boy, a waiter, a floor manager, and then a restaurant owner is an example of someone who is experiencing vertical mobility.

High labor mobility makes economies more flexible, because workers can quickly adapt to changing market conditions and demand. It tends to increase productivity, and helps industries and economies to grow. However, it also comes at a cost. A high supply of labor can bring wages down and it can also contribute to unemployment when the supply of workers is larger than the demand.

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