Working hard is good, but working efficiently is great.

I want to talk about why some jobs pay more than others and why someone like an actor can get paid far more than say a truck driver. From what I have observed, there seems to be 2 main factors that are responsible for the value of someone’s job.

The first one is supply and demand, you want a qualified engineer to work for you for $20 an hour? You can ask that but good luck finding one. Engineering specialisations are needed around the world but the ones capable are somewhat scarce and require allot of knowledge. This means that when someone is hiring, they need to offer a pay that competes against the offers of other companies. However, this still does not quite explain why some professions like actors get paid so much per hour than most other professions, which leads me onto the second factor. Famous actors like Robert Downey Jr. get paid enormous amounts per movie, does this mean we should raise our kids to become actors?

Not quite, the pay in the acting career is very skewed where only a little percent of actors make allot while the rest make figures not worth considering. So then why do directors pay these big-name actors so much for a film, surely they could find someone else for one tenth of the amount they ask for? This is because movies make heaps of money, it is a big business, and big-named actors like Robert have a reputation that will hook customers, more customers equal more money. The amount a typical big blockbuster film makes is usually 9 figures. No matter how hard a famous actor may work (provided they do what is needed), their pay-to-work ratio does not compare to most jobs. Teachers are more important than actors for a growing civilisation because they teach the future inventors while actors are purely for entertainment purposes. Teachers however do not get paid anywhere near the amount that famous actors do, even the top don’t. This is because there is no direct benefit from paying teachers at a higher wage, the schooling system does not make enough money to financially sustain teachers with large wages. Imagine if entertainment ceased to exist and all that money was collectively spent on education, what a world it would be. This second factor is based on the specific career and what area you belong within that career. People get paid based on what they do, not just how hard they work. Hard work is good, but efficiency is great. I respect anyone that works hard, but I pity them if they do not have the wits or have had the opportunity for a more efficient option. One may work hard, but does he work well?

The Chinese farmers compared to the American farmers in the mid-1900s had substantial differences in efficiency and hence economic output for both differed greatly. Chinese workers most likely worked longer hours than Americans, but either way due to their lack of resources, tools, intelligence on cropping techniques and soil chemistry, they were far less efficient at producing crop than the rate at which Americans could. This had dire consequences, it meant that farmers with less financial capital were far less efficient which lead to less financial return per hour of work, yet they did the same job as the Americans. The richer get richer (better assets leads to better income, better income leads to better assets). This is very true but I would like to reword it. The richer can get richer. This is to stop the ambiguity that the rich just get richer simply because they are rich. They certainly do have the resources to expand and therefore capitalise on their expansion, they benefit from what they benefit from, much like compound interest. What we can learn from these 2 factors; supply/demand and professions, is that you must not be fooled by believing there is equality among jobs in terms of their pay offers and hard-work. A job that pays you double than another does not mean you work twice as hard, a better way to interpret it is that this job benefits the company twice as much as the other job.

Image 1 (scale): thingiverse.com
Image 2 (actor): thewrap.com
Image 3 (farmer): keyword-suggestions.com