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INCOME AND WORK
Most people work for a living and the size of their income depends on what they get paid for their work. Earnings vary considerably among occupations. This income is a reward for producing goods or providing services that are wanted. It is the price of the worker’s services; the more valuable the worker’s time and effort are seen to be, the higher her or his income is likely to be.
In many occupations, the income received depends on the training, skills and experience of the individual worker, but it can also depend on the demand for the type of work and its supply. Some pop singers and television stars may receive very high incomes because they are popular with the public. Other singers and entertainers may be quite as talented but do not attract the public as much and so receive lower payment.
Other people who receive high incomes for their work are professional sportsmen and sportswomen, such as football and tennis players, because their level of skill is scarce and they can command high prices for people to watch them play.
That is to say, the supply of such skilled people is limited.
Some jobs are performed in unpleasant conditions. People do not want to do certain types of work and so there is a scarcity in supply of people for the work.
Higher wages have to be offered to attract workers.
While theoretically we are all free to enter any occupation we choose, in practice we are sometimes prevented by circumstances outside our control. To become a doctor or a barrister requires a very long period of education and training, and many parents cannot afford to support their children for such a long time. Children from poor families are less likely to receive the educational training necessary to enter the higher paid occupations unless the government assists with free education and scholarships. While the market system operates the same way with the price of labor (income) as with the prices of commodities, it does operate in favor of those people who find it possible to acquire the necessary training and skills to equip them for the better paid jobs.
The market system, operating alone and working purely on the demand and supply of labor, does not provide equal opportunities for rising to higher income levels. There must be positive encouragement by the government to create greater equality of opportunity because it will not be provided by anyone else.
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