Wages

Abstract

A wage can be defined as the reward for current toil. Everyone who is in gainful employment receives a wage, but not everyone’s earnings consist of a pure wage alone. Those with special skills have earnings which contain a rent element as well as a wage element; those with property rights have earnings where the rent element may predominate; and those who run the risk and uncertainty of what goods and services will be worth when exchanged, make profits or losses which may obscure any wage element in their earnings. Even those who are classed as wage-earners may receive more than pure wages; seniority increments or pay for special responsibilities contain a rent element, and special bonuses or profit-sharing schemes may give them a part of profit. Thus in practice classification of earnings is broad and in each category there is a mixture of the various types of income. The classification merely means that earnings are treated as wages if the pure wage element predominates.