Subway: The Labor Market

Demand for labor

The most obvious source of an increase of a demand for labor by an organization is an increase in the demand for the product or service provided by the firm. In the case of Subway, the organization provides both a product (food) and service (food preparation). When demand for sandwiches increases, the need for more workers to take orders, make sandwiches, clean the premises and mange the store will also increase. Another possible reason demand for labor might increase is a change in the types of goods and services offered. When Subway offered new types of sandwiches, such as hot hoagies or Panini, the more labor-intensive nature of such preparations may require an increase in workers (Carlinio n.d). Similarly, improvements in technology sometimes result in a decreased need for labor.

Is labor a fixed or variable cost in the short run? What are...
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