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What is the most likely impact of a recession on human resources? (A) Increase in wages (B) Increase in overtime (C) Decrease in involuntary separation (D) Decrease in employee bargaining power - HSC - SSCE Business Studies - Question 16 - 2014 - Paper 1
Question 16
What is the most likely impact of a recession on human resources? (A) Increase in wages (B) Increase in overtime (C) Decrease in involuntary separation (D) Decre... show full transcript
Worked Solution & Example Answer:What is the most likely impact of a recession on human resources? (A) Increase in wages (B) Increase in overtime (C) Decrease in involuntary separation (D) Decrease in employee bargaining power - HSC - SSCE Business Studies - Question 16 - 2014 - Paper 1
Step 1
Identify the likely impact of a recession on human resources
Answer
During a recession, businesses often experience decreased revenues, which typically leads to cost-cutting measures, including reduced labor costs. As a result, employee bargaining power diminishes because the supply of available labor increases due to layoffs and fewer job opportunities. This context makes it difficult for employees to negotiate favorable conditions or wages.
Step 2
Evaluate the options given
Answer
- Increase in wages: It is unlikely as companies try to reduce expenses.
- Increase in overtime: This may not be prevalent as companies may reduce hours instead.
- Decrease in involuntary separation: Counterintuitive in recessions, as layoffs often increase.
- Decrease in employee bargaining power: This option aligns with the typical responses observed during a recession.
Step 3