The phenomenon of underutilization of labour during a recession is called
A) labour stockpiling.
B) investing in human capital.
C) labour force stabilization.
D) labour hoarding.
E) retraining labour.

Question

Quizplus · Accepted Answer

Labour hoarding refers to the practice of retaining employees even when demand for their services falls, leading to underutilization of labour during economic downturns. This reduces the immediate financial impact on businesses but can ultimately lead to a longer recession as it decelerates recovery. Labour stockpiling implies the opposite of labour hoarding; that is, increasing staff levels beyond necessary demand, which is not the case in a recession. Investing in human capital is aimed towards improving the quality of labour and is not a solution to the underutilization of labour during a recession. Labour force stabilization could be seen as an ideal situation where there is no underutilization of labour, but this term is not typically used to describe the phenomenon during recessions. Retraining labour generally refers to upskilling employees for better positions, not about underutilization of labour.

The Phenomenon of Underutilization of Labour During a Recession Is