What is a market?
The sphere of formation of supply and demand for labor is called the labor market. It is through him that one can find employees in his company.
What is the labor market and what are its features? First of all, the labor market is distinguished by the fact that the object of sale and purchase is the use of knowledge, labor, qualifications, as well as the ability of a person to the labor process.
But this is a narrow definition of the concept “labor market”. If we talk about the broader meaning of the term, then the labor market can be characterized as a system of relations in society - legal and socio-economic, as well as institutions and norms that exist specifically to ensure that the process of reproduction of the work force is continuous.
How is labor demand shaped? Considering that we live in conditions of free competition, demand is formed by two main indicators: wages and the cost of the product of labor, which was produced by the hired worker. As for the labor supply, it is interconnected with the level of payment.The pattern here is this: if the level of labor supply has become higher, then, accordingly, the salary will also be higher.
The emergence of the labor market was the result of the development of market relations and the development of capitalism. We are talking about free labor, when an employee is not obliged to work in a particular organization, as was the case in the feudal era, and can leave the company at any time.