In Eastbrook 500 workers were employed at the start. Assuming the 4 per cent fall applies to that number, how many positions were lost, and what does unchanged hours per employee add?
After a regional minimum wage rose by 10 per cent, researchers compared three towns over two years. In Eastbrook, which depends on tourism, employment in cafes and hotels fell by 4 per cent while average hours worked per employee stayed unchanged. In Marlow, a farming town, employment in the same sector rose by 2 per cent. In Dunmore, a mining town with few small employers, employment did not change but the number of job advertisements fell by 15 per cent. The researchers noted that Eastbrook lost visitors during the second year because of a road closure. A columnist wrote that the study 'proves a wage rise costs jobs'.
Answer and explanation
Correct answer: C. 20 positions; total hours fell too
- Step 1: 4 per cent of 500 = 20. Step 2. Total hours = employees x hours per employee. Step 3. Employees fell while hours per employee stayed the same, so total hours fell. Answer: 20 positions and lower total hours. Why not the others: total hours cannot stay the same or rise when headcount falls and hours per person do not change.
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