Economics - Labour Market Outcomes

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Labour Market Outcomes

Differences in incomes from work

• Wage outcomes for all persons by income groups, occupational groups, age, gender and cultural background

Wage differentials between different occupations

Different occupations require different levels of education and skills. Workers fall into occupational groups that do not compete with each other and the average differentials between them reflect the different levels of education and skills required to perform the jobs. In the labour market, people are generally rewarded for working in occupations that require a higher level of skill and a longer period of training.

Some occupations by their nature, involve working conditions that are less appealing that others. People who work in occupations quite often get paid a higher wage rate as compensation for those poorer working conditions.

Occupational mobility (the ease by which labour can move from one occupation to another) will also influence occupational wage rates. Where occupational mobility is high, the supply of labour to that occupation is always likely to be high, and there is less need for employers to raise wages to attract labour. On the other hand, when occupational mobility is restricted, labour supply is less abundant and wage rates tend to be higher. For example, highly specialised occupations such as veterinary surgeons, accountants and lawyers experience limited occupational mobility because it takes a long time to develop the skills to be able to move into these occupations.

Wage rates for workers within a particular industry will be dependent upon the relative bargaining power of employees and employers in that industry.

Wage differentials in the same occupation

Geographical labour mobility (the ease by which labour can move from one area to another) will influence wage rates within the same occupation. For example employers find it difficult to attract labour to isolated locations and generally have to pay higher...