Have you ever wondered why you seem to get the same amount, and the lack of money is more noticeable every month? If so, then we should talk about real and nominal wages.
Wages, in essence, are the price that the employer is willing to pay for labor, expresses the cost of labor. Wages are calculated by the hour, per month, per year, in the form of a bonus, as well as in implicit monetary form as paid leave, insurance, possibly (as is well known since Soviet times) in the form of goods. However, wages are often calculated per unit of time. In a socio - economic sense, wages are obliged to ensure the reality of reproduction for humanity as a whole.
If you dig deeper, then wages can be divided as nominal and real. The nominal wage is the amount of money that you receive as a result of the work. The real wage reflects the true value of the money received, shows how many goods or services you can buy with the money received. Among other things, real wages are calculated net of all mandatory tax contributions.
Real wages reflect the true value of labor in the market. Under the influence of such factors as the intensity of labor, its complexity, the minimum wage (established by law), the rate of taxes and mandatory contributions, the dynamics of prices for goods and services, supply and demand for different categories of labor force, real wages are formed.
For an illustrative example, we can assume that the inflation rate over the past year has grown by 5 percent, while the nominal wages, as all newspapers and news are rushing to inform us, have grown by 9 percent, it follows that the growth in real wages will be the difference between these two values. , or rather 4 percent.
It is also worth considering such a concept as "wages on hand". This is a salary, without an employment contract. On the one hand, insurance and taxes are not deducted from it, and this is good news, however, do not forget that you simultaneously lose all social packages, the employer does not bear any responsibility, and the risk of being left with nothing is growing.
In any capitalist state, the level of prices grows every year, and taxes also rise. Naturally, employers have to respond to workers' outrage and raise nominal wages. But in comparison with the rise in inflation, the growth of interest on real wages leaves much to be desired. At the same time, the growth of real wages is the main source of increasing the well-being of the people.
The most obvious reasons for the high level of real wages in developed countries are the predominance of demand for labor over supply, as well as active measures to improve labor efficiency.
