Why do jobs pay so little?

We’ve all seen the “Now hiring” signs. We’ve also seen when they say “competitive pay” so we apply just to see that it’s an average pay and not a ‘competitive pay.’ If companies need workers, and people need to work, why don’t companies pay their workers? These low wages aren’t enough to encourage people to do those jobs or stay there for a long time. So many people working 40 hours per week or more are struggling to pay for their basic necessities and are not able to put money away for an emergency. So why do jobs pay so little?

Supply and Demand:

The basic principles of supply and demand significantly influence wage rates. When the supply of labor exceeds the demand, employers gain the upper hand in salary negotiations, resulting in stagnant or declining wages. So if the number of available workers is higher than the number of available jobs, the pay will be low because these workers are easily replaceable. Also, advances in technology have made some jobs obsolete. In the future, we may see less jobs being performed by a human. For example, cashiers are no longer needed in many places. You can see this at most grocery stores when you use the self checkout computer.

Skills Mismatch:

As job markets evolve, there may be a gap between the skills workers possess and the skills employers demand. The oversupply of certain skills and the shortage of others can disrupt the balance of power, leading to lower wages for those in professions with an abundance of qualified candidates.

Income Inequality:

Over the past few decades, income inequality has risen significantly, with a concentration of wealth at the top. This disparity can lead to reduced purchasing power for the majority, leading to slower economic growth and limited wage growth. Corporations trying to maximize their profits choose to dedicate a smaller percentage of revenue towards wages, further contributing to income inequality. Many corporations can definitely afford to pay their workers more and still be drowning in profits. They won’t because they care about their profits more than their workers. They don’t realize that without the workers those corporations wouldn’t exist.

Global Competition and Outsourcing: Economic globalization has given rise to intense competition, particularly from countries with lower labor costs. In an attempt to remain competitive, companies may outsource jobs or relocate production to regions with lower wages. This displacement can contribute to lower wages for workers in higher-wage countries. For example, most clothes is not made in United States because it is cheaper to make it in places like China, Bangladesh, and other countries.

Minimum Wage:

The minimum wage, set by governments, can play a crucial role in wage determination. In many cases, minimum wage rates fail to keep up with the rising cost of living, resulting in workers receiving wages below a livable standard. In my opinion, minimum wage should be enough to support the essential needs of one person if they are working full time regardless of what the job is.

Conclusion:

The issue of low wages in today’s economy is a complicated problem, influenced by various factors. Supply and demand, income inequality, global competition, and technological advancements all contribute to determining wage rates. I think there needs to be some changes in how pay is determined and how much people are valued. It seems that some of the most important people are taken advantage of, not valued, overworked, and underpaid while some of the least important people are valued and overpaid. Someone can work in agriculture or construction or an another job that requires hard labor and barely make enough for themselves and their family while someone else can make millions by playing a game. Something needs to change.

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