Week Eight Threaded Discussion

Running head : WEEK EIGHT

Week Eight Threaded Discussion

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Abstract

Official statistics provides sufficient information about the wage levels across different industries and economic sectors . The major question is what drives wages ? Wages may be driven by one or several factors : compensating differentials , human capital , natural abilities or the superstar phenomenon

Week Eight Threaded Discussion

Official statistics provides sufficient information about the wage levels across different industries and economic sectors . Apart from revealing a large wage gap between certain groups

of professions , the statistical research suggests that the reasons and implications of these wage differences should be studied in more detail

The mean annual wages in management sector do not exceed 97 ,000 business and financial professionals annually earn 62 ,410 in average Computer and mathematical science occupations seem to do better than those in financial area with 72 ,190 per year , while engineering occupations do not bring more than 68 ,800 annually . Average earnings in community and social services area are 40 ,540 in legal occupations - 88 ,450 in arts , design and entertainment - 48 ,410 . Food preparations and serving related occupations are ranked the lowest and did not exceed 19 ,440 in 2007 (Bureau of Labor Statistics , 2008 . The major question is what drives wages

There is no single answer to that . From the neoclassical viewpoint , the marginal product for labor usually equals the wage 's amount for every additional worker . Furthermore , depending on the specific occupation and profession , wages may be driven by one or several factors : compensating differentials , human capital , natural abilities , or the superstar phenomenon . Compensating differentials arise from nonmonetary characteristics of a job (for example , emergency rescue employees should be compensated for risk . Education can determine the quality of human capital and differentiate low-ability from high-ability workers (the wages in food preparations and servicing domains are the lowest , due to the fact that they are not related to risk (compensating differentials nor require higher education (human capital or natural ability Superstars are traditionally formed in the markets where the customers want to be supplied by the best producer and at a relatively low cost We see that wages in computer technology professions are definitely driven by superstar phenomenon , where one supplier tries to satisfy all customers , and where the wage depends on one 's ability to support the company 's superstar ' image . The level of wages is usually determined by supply and demand of labor in specific labor markets however , the discussed factors substantially change the situation , and add to the constantly changing economic situation in the national and international workforce markets

References

Bureau of Labor Statistics (2008 . Occupational employment and wage estimates . Retrieved

July 26 , 2008 from HYPERLINK "http /www .bls .gov /oes /oes_data .htm http /www .bls .gov /oes /oes_data .htm

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