Wages and salaries are the major source of income for households (56%) The other main source of income include: - Business profits - Capital investments ^ (18% together) - Government pensions or allowances (10%) - Property income (11%)
Average weekly earnings are a good indicator of whether worker's income are rising or falling. Yet they do not take into account changes in the inflation rate. Real wages levels are a measure of purchasing power of money and are a good indicator of whether wages are keeping pace with inflation. (Refers to wether the wages increase you take out the inflation pressure in the increase in your wages and what money you have left).
Differences in wages outcomes
Different occupations require different levels of educations and skill. Wage rates reflect these differences. (e.g year co-ordinator has more responsibility compared to a normal teacher therefore the year co-ordinator will receive more money). Generally, occupations which require higher levels of education and skills receive higher incomes reflecting these differences. Occupations which have unattractive working conditions usually receive a higher rate of pay. Wages rates also reflect occupational mobility.
If a particular occupations has a mobile labour supple, wage rates are likely to be lower. However if the supply of labour is highly immobile wage rates will rise to attract workers into the profession. The highest paid workers are managers and administrators whereas, the lowest paid workers are clerical, sales and service workers. Wages rates may also rise to attract workers to geographically isolated areas. Highly productive labour units may also rise in their wage levels. Wage outcomes also reflect the capacity of a firm to pay increased wages.
Income varies over one's lifetime and is highest during the peak earning periods of ages 25 – 64. Income is at its lowest...