which of the following is not a strong basis for trade unions demand for higher wages

Analyzing the question

The question asks which option is NOT a strong basis for a trade union to demand higher wages. So we are looking for the weakest or least relevant justification.

The concept

Trade unions usually justify wage demands with arguments such as:

• Rising productivity: workers are producing more, so they deserve a share of the gains.
• Higher company profits: the firm can afford to pay more.
• Rising cost of living: inflation reduces the real value of wages.
• Comparability: workers in similar jobs elsewhere earn more.
• Inelastic demand for the product or labour: the employer cannot easily replace workers, or consumers will still buy the product even if prices rise.

Going through the options

• A. Company is making higher profit: a strong basis. The firm can afford higher wages, and workers helped create the profit.
• B. Productivity of workers has increased: a strong basis. Higher output per worker justifies higher pay.
• C. Members of the union have high qualifications: a reasonable basis. Skills and qualifications raise the value of labour, so higher pay is justified.
• D. Commodity produced by the workers is very essential: this is the weakest. Whether a product is essential has no direct link to a worker's own contribution or ability to pay. Essential goods can even be sold at controlled or regulated prices, which limits what the firm earns. Strictly, an essential product means inelastic demand, which could help a union, but it is far less direct than profit, productivity or qualification.

Note on option C

Some students may be tempted to pick C because not all union members need to be highly qualified. However, qualification is a standard argument for wage differences in labour economics, so it counts as a valid basis.

Answer: D

Exam tip

For "which is NOT a basis for wage demand" questions, look for the option that does not relate directly to the workers' productivity, skill, the employer's ability to pay, or the cost of living. The nature of the product is the odd one out.