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A firm has a vacancy that none of its current employees can fill. Which pool must it turn to, and what is that pool called?
AIts current employees, called the internal labor market
BIts union bargaining unit, called the protected class
COutside prospects, called the external labor market
DIts retired workers, called the contingent workforce
Answer & Solution
Correct answer: C. Outside prospects, called the external labor market
1. Firms normally try the internal labor market first, because promotion and transfer are cheaper and faster.
2. The question states that no current employee can fill the vacancy, which closes off that route.
3. The external labor market is defined as the prospects available to fill positions that cannot be filled from within.
4. So the firm must recruit outside, and the pool it recruits from is the external labor market.
5. Option A is ruled out by the premise, since the internal pool has already failed to produce a candidate.
6. A bargaining unit is a voting group in a union election and a contingent workforce is a temporary staffing arrangement, so neither is a recruiting pool.
_Source: OpenStax Introduction to Business (CC BY 4.0), Ch 8 "Managing Human Resources and Labor Relations", section External Labor Market_
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