WAGES

The income given in exchange to those who supply their labor to any business is called "wages," and includes salaries, and various wage and salary supplements, such as bonuses, commissions, royalties, social insurance, pensions, and health plan benefits. About 75 per cent of all business costs are wages. At this level, wages have a very significant impact on all per unit production costs of any business. Wages differ widely among nations, regions, occupations, and individuals. Wage rates also differ by gender and race. Statistical data indicates that the general level of wages in the United States is among the highest in the world, with the explanation being that the United States demand for labor is great in relation to supply. Economists have also indicated that the labor demand is strong because the U.S. worker is highly productive, working in a country with an abundance of capital equipment, natural resources, advanced technology, better health and educational services, and the business and political support of a production oriented economy.

Evidence also suggests to economists that unionized labor is successful in raising the wages of its members. Union members typically receive a 10 to 15 percent wage advantage over non-union workers, without creating business obstructions. Why one person earns a high wage and another a lower wage is a matter of supply and demand. Even doing the same job, some workers bring superior abilities, skills, and commitment to the job, and frequently, such workers are rewarded with increased wages and job advancements. Geographic locations, market imperfections, and the differential in the work required can account for other differences in wages with similar groups of people in the workforce.