The number of people willing to work is called the labour force; the total
number of hours they are willing to work is called the supply of labour
The supply of labour depends on three influences: the size of the
population, the proportion of the population willing to work, and the
number of hours that each individual wants to work. We look at each of
these influences in more detail, and see how each is partly influenced by
economic forces.
Population
The population of a country varies over time, and these variations are
influenced by economic forces. There is evidence, for example, that the
birth rate and the net immigration rate (immigration minus emigration)
are higher in good economic times than in bad. In Canada today, the
population grows at just less than 1 percent annually, but this growth is
largely because of Canada’s net inflow of immigration. (In the absence of
any immigration, Canada’s birth rate is insufficient to keep our population
from gradually declining.)
Labour-Force Participation
The proportion of the total population that is willing to work is called the
labour-force participation rate. Economists also define participation rates
for subgroups, such as men, women, or youths. Participation rates vary in
response to many influences, including social change. The enormous rise
in female participation rates between the 1960s and 1990s, for example,
had a significant effect on the Canadian labour force.