Economic inequality is a hot topic right now – especially when some Americans have been able to achieve extensive income and wealth compared with others.
Today, Alexander Green explains why there are good reasons for this disparity and what lagging individuals can do to catch up.
Over the past few weeks, we’ve been discussing the issue of economic inequality, how to think about it and what to do about it.
It’s quite true that some Americans have more income and wealth than others.
But is this unfair? Think about it.
Is it wrong for a doctor to make more than a nurse, a pilot to make more than a flight attendant, or a business executive to make more than her secretary?
Of course not.
Everyone realizes that some career choices require more education, more skills and more experience than others.
Workers in every quintile have seen their incomes rise in recent years. But we live in a knowledge-based society, and workers with higher-value skills have seen their incomes rise faster than those with less education or less commercially valuable skills.
What if two workers do the same job, however? Is it wrong for one to make more than the other?
One may have more experience or time on the job than the other. One may work more shifts or longer hours. In those cases, the difference is understandable.
Or one employee may simply do a better job than another as measured by sales generated, customers satisfied, or positive assessments from colleagues and supervisors.
In short, income disparities are not necessarily unfair.
Last year, for example, Vox ran an article with a shocking headline: “Nationwide, Male Doctors Get Paid $100,000 More Than Female Doctors.”
Complete with statistics and graphs, it sounded alarming. But the real story?
More male doctors than female doctors are specialists and surgeons. And specialists and surgeons – whether male or female – make more than generalists, male or female.
There goes the disparity… and the injustice.
So it goes with the much ballyhooed “gender pay gap” generally.
After accounting for vocation, specialization, education, experience and hours worked, the difference is negligible.
That’s exactly what you’d expect to find given two salient facts:
It is against federal law to pay a woman less than a man for the same work.
Our nation has no shortage of tort attorneys.
The lesson here? Earned income is usually decided by nine factors:
Your educational attainment
Your chosen profession
Your years of experience
Your hours worked
Your work ethic
Your social skills
Your competence and proficiency at what you do
Your ability to cooperate with, inspire and lead your coworkers
Your ambition to rise in the organization.
If you want to earn more, the choice is clear: Make yourself more invaluable.
Yes, some people are born with greater genetic gifts than others.
You and I were not born with the looks of Brad Pitt, the athleticism of LeBron James or the intellect of Isaac Newton. Too bad for us.
Some are dealt better hands than others. But we each have to play whatever hand we’re dealt as skillfully as possible.
From an economic standpoint, that means maximizing your education and marketable skills, showing competence, reliability and …read more
Source:: Investment You