Final answer:
A Cost-of-Living Adjustment (COLA) is a local factor that affects your fee by adjusting wages to keep up with inflation and maintain the purchasing power in the face of economic fluctuations like unemployment and cost-of-living changes.
Step-by-step explanation:
The local factor that might affect your fee, considering industries, unemployment impact, and benefit plans present in the area, is referred to as the Cost-of-Living Adjustment (COLA). In the 1970s and 1980s, labor unions negotiated wage contracts that included COLAs to ensure wages kept pace with inflation. These adjustments are a form of indexing that adjusts wages based on the inflation rate so that the purchasing power of employees is maintained amidst rising prices.
Understanding COLAs is critical as they reflect how various economic pressures, such as cyclical unemployment, cost-of-living, and other economic fluctuations, can dictate the necessity for wage adjustments. COLAs aim to offset these pressures and maintain the employee's standard of living within their specific geographic area.