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A wage is compensation which workers derive from their labor. In labor and finance settings wage may be defined more narrowly to include only cash paid for some specified quantity of labour. Wages may be contrasted with salaries, with wages being paid at a wage rate (based on time worked) while salaries are paid periodically without reference to hours worked. Once a job description has been established, wages are often a focus when negotiating an employment contract between employer and employee. Economists define wages more broadly than just cash compensation and include any return to labor, such as goods workers might create for themselves, returns in kind (such as sharecroppers receive), or even the enjoyment that some derive from work. For economists, even in a world without others, an individual would still acquire wages from labor: food hunted or gathered would be considered wages and any returns resulting from an investment in tools (such as an axe or a hoe) would be deemed interest (a return on a capital investment). Depending on the structure and traditions of different economies around the world, wage rates are either primarily market-driven (the USA) or influenced by other factors such as tradition, social structure and seniority, as in Japan. Several countries have enacted a statutory minimum wage rate in an attempt to prevent the exploitation of low-paid workers.
Etymology Wage derives from words suggesting making a promise, often in monetary form. Specifically from the Old French word wagier or gagier meaning to pledge or promise, from which the money placed in a bet (wager) also derives. These in turn may derive from the French gage to wager, the Gothic wadi, or the Late Latin wadium, also meaning "a pledge". Wages in the United States In the United States, wages for most workers are set by market forces, or else by collective bargaining, where a labor union negotiates on the workers' behalf. The Fair Labor Standards Act requires a minimum wage at the federal level although states and cities can and sometimes do set their own higher minimum. For certain federal or state government contacts, employers must pay the so-called prevailing wage as determined according to the Davis-Bacon Act or its state equivalent. Activists have also undertaken to promote the idea of a living wage higher than current laws require. See also | ||||||||
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