WAGES AND WAGE RATE, The efficiency of labour and the concept of unemployment
Hey guys,
Welcome to my blog.
Coming before this wonderful community to share my academic understanding of wages, wage rates, the effectiveness of labor, and the concept of unemployment brings me nothing but delight.
Given the current state of the nation, you would concur with me that the idea of unemployment is a significant concern on the minds of many Nigerians.
Will they be able to find a white collar job? This is a question that many people especially students wonder about when they graduate from college. What is the real reason for unemployment?
Stay tuned as we discuss each of these.
It is true that wages are the reward for labor, as economists are taught to believe.
Wages can be defined as the compensation or payments made to laborers in exchange for their services.
It may also be referred to as the monetary payment made by employers to their staff in exchange for the time spent helping to expand the company's business.
It can also be considered a cost of doing business, and regardless of how profitable the firm is, the owner must pay his employees' salary.
The term "salary" generally refers to a wage that is received on a monthly basis but can also be paid daily, weekly, or monthly.
For instance, when you consent to offer someone a specific service in exchange for, say, $10.
The $10 that was paid to you once the work was completed can then be considered to be your wage.
You might also choose to receive your compensation at the end of the day if you work at a coffee shop for $20 an hour.
You can consider the payment to be your remuneration for working in the coffee shop when it is made.
- Minimum wage
The most common pay in the business world is this one.
The lowest wage an employer is willing and able to offer an employee for the services provided is called the minimum wage, as the name suggests.
An individual's salary is typically determined by their qualifications; the higher the qualification, the higher the salary.
As of the time this piece was written, the minimum pay for laborers in my nation is 30,000NGN, or 140 Steem as of the time of this post.
- Living wage
A living wage can be defined as the minimum pay required for an employee to meet his or her fundamental needs, including those for clothing, food, and housing.
A bachelor's living income will undoubtedly be different than a married man's because a bachelor must provide for himself alone while a married man must also take care of his family.
The purpose of a livable wage is to guarantee that a worker can meet his minimal but respectable needs.
Living wage and the minimum wage are two separate sorts of wages, but they are frequently used interchangeably.
Although the basic needs of an individual may not be met by a minimal wage, those of a laborer may be more than met, they are significantly different from one another.
- Prevailing wage
Prevailing wage can be defined as the kind of pay that a contractor is required to give a worker when they are employed by a government agency.
Prevailing pay may also include additional perks associated with working for a government organization.
For instance, if you work for a government organization, you are entitled to additional benefits in addition to the salary that is typically discussed.
- Tipped wage
The term "tipped wage" refers to a base pay paid to a worker who receives a significant amount of their income in the form of tips.
A typical labor law clause known as "tip credit" states that when tips and wages are added together, the worker's total income must equal the minimum wage for the nation.
And if that's not the case, the employer must raise the pay at least to the federal minimum wage.
The amount of pay given to a worker per unit of time is how wage rate is best understood.
It can be interpreted as the rate of pay for the contributions laborers make to the production process.
The formula for calculating wage rate is: Total amount paid / Total effective hour worked.
The salary rate would have been discussed in advance of a service being provided between the employer and the employee.
- Time rate system
This wage rate method compensates workers based on the amount of time they contribute to the production process.
This means that as a worker, you will be compensated for the time spent engaged in the production process; your salary will be determined according to the amount of time invested rather than the quality of your work.
For instance, in the United States, you might choose to work in a coffee shop where you would be paid $20 per hour, which would include receiving payment for each hour of work.
Because the price is $20 per hour, even if you work extremely hard and produce an output of 5 hours in 30 minutes, you won't get compensated.
The time wage rate system is what this system is called.
- Piece rate system
Since this rate of operation mostly depends on the output of a laborer's service, it differs significantly from the time rate output.
The worker in this case is paid based on the services provided, the commodities delivered or sold, and not on the amount of time worked.
For instance, a laborer working in a shop for 30 minutes could sell more than $3000 worth of goods and still be paid according to the value of those sales.
It is possible to define unemployment as the state of being able-bodied but unable to obtain job.
There aren't enough jobs available for people who are able and eager to work in this state.
Unemployment is caused by a variety of circumstances, some of which are listed below.
- Overpopulation
When there are too many people applying for too few jobs in a country, only a small number of groups of people will end up getting hired.
- Illiteracy
The inability to read and write in any language is known as illiteracy, and it is a significant contributor to unemployment.
Due to the need for literate people to operate in the vacant area, there is a higher percentage of unemployment.
- State of Economy
This is another another reason why there are so many unemployed people; when a country's economy is struggling, businesses often fire workers in order to make ends meet, or they hire fewer people overall.
- Structural unemployment
This particular sort of unemployment results from a change in a company's technological way of operation.
For instance, it is typically difficult and time-consuming to educate employees to utilize a new technical device, and as a result, companies tend to fire employees from their professions.
Another illustration is the introduction of robots into the workplace. Since some robots are made to carry out tasks that should be handled by people, workers in that industry will lose their jobs as a result.
- Fictional unemployment
Since frictional unemployment tends to be transient, it might be referred to as the least troublesome kind of unemployment.
It is believed to happen when laborers voluntarily leave their jobs for reasons best known to them. Since it is difficult for them to find new employment after leaving their current position, they remain jobless until they are able to find a good position.
This is distinct from people who stay in their current positions till they find another since they never experienced unemployment.
- Cyclical unemployment
This type of unemployment can be defined as being linked to a company's cyclical tendency.
Cyclical unemployment will decrease if the economy is doing well, but it will peak if the economy is struggling.
Cyclical unemployment is typically caused by a drop in commodity demand over an extended period of time, which results in very little demand for labor.
When the rate of cyclical unemployment is high, the economy is just starting to decline. Cyclical unemployment is typically used as a sign to tell when a country's economy is falling.
- Disguised unemployment
This type of unemployment happens when a portion of the workforce is unemployed or is working in a fashion that results in zero productivity.
When there are too many people competing for too few jobs and the productivity is low, this is referred to be disgused unemployment in an economy.
In a word, we can define conceal unemployment as an instance in which a certain segment of the labor force is not utilized at its full potential.
- Casual unemployment
This is a form of unemployment brought on by contract jobs, or jobs having a brief lifespan.
For instance, in order to perform a job like painting, a painter must wait until he receives a new contract; in the interim, he is not employed.
- Residual unemployment
This type of unemployment happens as a result of the employee's wellbeing being compromised.
For instance, a person with mental instability cannot work because he is unsuited for any type of employment.
The ability of labor to improve output and production without necessarily hiring more workers is how the efficiency of labor is best understood.
To put it another way, it can be defined as the laborers' capacity to raise their game and increase their output over a predetermined period of time.
The efficiency of labour is influenced by many factors and some of them will be explained below.
- Job security
One element that affects the productivity of labor is job security.
A worker will be motivated to work if he is assured that he will have a long period to dedicate to contributing to the expansion of a company.
Additionally, if an employee is unsure about how long his services will be required, he may not give the organization his best effort, which will have an impact on his productivity.
- Attractive reward
This can be seen on Steemit, where there were many active posters in many groups when Sbd printing was still available, but many users have since stopped posting while patiently waiting for Sbd to be printed.
Without sbd printing, they believe, they will only receive pennies as compensation, which they find unappealing.
The same is true for other corporate organizations; when wages are low, workers won't be motivated to put in their best efforts, which will reduce labor productivity.
- Well being of labourers
Another factor affecting labor productivity is physical fitness. Physically unfit workers are unable to perform the required tasks and cannot produce as much work as physically fit workers.
As a result, if labor productivity is to be raised, consideration for workers' physical well-being is required.
- Specialization and skill
When attempting to improve labor productivity, this is yet another crucial issue to take into account.
A worker lacking the necessary skills will not be able to provide the desired output in a company, or will instead work slowly because he is still a novice.
Therefore, a worker with the necessary expertise should be hired for a higher production.
It is crucial that a laborer employed by a government agency earn at least the federal minimum wage; if not, he may request that he be paid at least that amount.
As it helps to create our perspective on salaries, the wage rate, and unemployment in the nation, I hope that university students find this topic to be helpful.
You have written well @lordchuddy.
What you said concerning unemployment is well cleared