Wage labour
Overview
 
Wage labour is the socioeconomic
Socioeconomics
Socioeconomics or socio-economics or social economics is an umbrella term with different usages. 'Social economics' may refer broadly to the "use of economics in the study of society." More narrowly, contemporary practice considers behavioral interactions of individuals and groups through social...

 relationship between a worker
Workforce
The workforce is the labour pool in employment. It is generally used to describe those working for a single company or industry, but can also apply to a geographic region like a city, country, state, etc. The term generally excludes the employers or management, and implies those involved in...

 and an employer
Employment
Employment is a contract between two parties, one being the employer and the other being the employee. An employee may be defined as:- Employee :...

, where the worker sells their labour
Labour economics
Labor economics seeks to understand the functioning and dynamics of the market for labor. Labor markets function through the interaction of workers and employers...

 under a formal or informal employment contract
Contract
A contract is an agreement entered into by two parties or more with the intention of creating a legal obligation, which may have elements in writing. Contracts can be made orally. The remedy for breach of contract can be "damages" or compensation of money. In equity, the remedy can be specific...

. These transactions usually occur in a labour market where wage
Wage
A wage is a compensation, usually financial, received by workers in exchange for their labor.Compensation in terms of wages is given to workers and compensation in terms of salary is given to employees...

s are market determined. In exchange for the wages paid, the work product generally becomes the undifferentiated property
Work for hire
A work made for hire is an exception to the general rule that the person who actually creates a work is the legally recognized author of that work...

 of the employer, except for special cases such as the vesting of intellectual property
Intellectual property
Intellectual property is a term referring to a number of distinct types of creations of the mind for which a set of exclusive rights are recognized—and the corresponding fields of law...

 patents in the United States where patent rights are usually
Freelancer
A freelancer, freelance worker, or freelance is somebody who is self-employed and is not committed to a particular employer long term. These workers are often represented by a company or an agency that resells their labor and that of others to its clients with or without project management and...

 vested in the original personal inventor.
Encyclopedia
Wage labour is the socioeconomic
Socioeconomics
Socioeconomics or socio-economics or social economics is an umbrella term with different usages. 'Social economics' may refer broadly to the "use of economics in the study of society." More narrowly, contemporary practice considers behavioral interactions of individuals and groups through social...

 relationship between a worker
Workforce
The workforce is the labour pool in employment. It is generally used to describe those working for a single company or industry, but can also apply to a geographic region like a city, country, state, etc. The term generally excludes the employers or management, and implies those involved in...

 and an employer
Employment
Employment is a contract between two parties, one being the employer and the other being the employee. An employee may be defined as:- Employee :...

, where the worker sells their labour
Labour economics
Labor economics seeks to understand the functioning and dynamics of the market for labor. Labor markets function through the interaction of workers and employers...

 under a formal or informal employment contract
Contract
A contract is an agreement entered into by two parties or more with the intention of creating a legal obligation, which may have elements in writing. Contracts can be made orally. The remedy for breach of contract can be "damages" or compensation of money. In equity, the remedy can be specific...

. These transactions usually occur in a labour market where wage
Wage
A wage is a compensation, usually financial, received by workers in exchange for their labor.Compensation in terms of wages is given to workers and compensation in terms of salary is given to employees...

s are market determined. In exchange for the wages paid, the work product generally becomes the undifferentiated property
Work for hire
A work made for hire is an exception to the general rule that the person who actually creates a work is the legally recognized author of that work...

 of the employer, except for special cases such as the vesting of intellectual property
Intellectual property
Intellectual property is a term referring to a number of distinct types of creations of the mind for which a set of exclusive rights are recognized—and the corresponding fields of law...

 patents in the United States where patent rights are usually
Freelancer
A freelancer, freelance worker, or freelance is somebody who is self-employed and is not committed to a particular employer long term. These workers are often represented by a company or an agency that resells their labor and that of others to its clients with or without project management and...

 vested in the original personal inventor. A wage labourer is a person whose primary means of income is from the selling of his or her labour in this way.

In modern mixed economies such as that of the OECD countries, it is currently the dominant form of work arrangement. Although most work occurs following this structure, the wage work arrangements of CEOs, professional employees, and professional contract workers are sometimes conflated with class assignments
Working class
Working class is a term used in the social sciences and in ordinary conversation to describe those employed in lower tier jobs , often extending to those in unemployment or otherwise possessing below-average incomes...

, so that "wage labour" is considered to apply only to unskilled, semi-skilled or manual labour
Manual labour
Manual labour , manual or manual work is physical work done by people, most especially in contrast to that done by machines, and also to that done by working animals...

.

Types

The most common form of wage labour currently is ordinary direct, or "full-time", employment in which a free worker sells his or her labour for an indeterminate time (from a few years to the entire career of the worker), in return for a money-wage or salary and a continuing relationship with the employer which it does not in general offer contractors or other irregular staff. However, wage labour takes many other forms, and explicit as opposed to implicit (i.e. conditioned by local labour and tax law) contracts are not uncommon. Economic history shows a great variety of ways in which labour is traded and exchanged. The differences show up in the form of:
  • employment status: a worker could be employed full-time, part-time, or on a casual basis. He could be employed for example temporarily for a specific project only, or on a permanent basis. Part-time wage labour could combine with part-time self-employment
    Self-employment
    Self-employment is working for one's self.Self-employed people can also be referred to as a person who works for himself/herself instead of an employer, but drawing income from a trade or business that they operate personally....

    . The worker could be employed also as an apprentice
    Apprenticeship
    Apprenticeship is a system of training a new generation of practitioners of a skill. Apprentices or protégés build their careers from apprenticeships...

    .
  • civil (legal) status: the worker could for example be a free citizen, an indentured labourer, the subject of forced labour (including some prison or army labour); a worker could be assigned by the political authorities to a task, he could be a semi-slave
    Slavery
    Slavery is a system under which people are treated as property to be bought and sold, and are forced to work. Slaves can be held against their will from the time of their capture, purchase or birth, and deprived of the right to leave, to refuse to work, or to demand compensation...

     or a serf
    Serfdom
    Serfdom is the status of peasants under feudalism, specifically relating to Manorialism. It was a condition of bondage or modified slavery which developed primarily during the High Middle Ages in Europe and lasted to the mid-19th century...

     bound to the land who is hired out part of the time. So the labour might be performed on a more or less voluntary basis, or on a more or less involuntary basis, in which there are many gradations.
  • method of payment (remuneration or compensation
    Compensation of employees
    Compensation of employees is a statistical term used in national accounts, balance of payments statistics and sometimes in corporate accounts as well...

    )
    . The work done could be paid "in cash" (a money-wage) or "in kind" (through receiving goods and/or services), or in the form of "piece rates" where the wage is directly dependent on how much the worker produces. In some cases, the worker might be paid in the form of credit used to buy goods and services, or in the form of stock options or shares in an enterprise.
  • method of hiring: the worker might engage in a labour-contract on his own initiative, or he might hire out his labour as part of a group. But he may also hire out his labour via an intermediary (such as an employment agency) to a third party. In this case, he is paid by the intermediary, but works for a third party which pays the intermediary. In some cases, labour is subcontracted several times, with several intermediaries. Another possibility is that the worker is assigned or posted to a job by a political authority, or that an agency hires out a worker to an enterprise together with means of production
    Means of production
    Means of production refers to physical, non-human inputs used in production—the factories, machines, and tools used to produce wealth — along with both infrastructural capital and natural capital. This includes the classical factors of production minus financial capital and minus human capital...

    .

Critique of wage labour

The first point of criticism is on the freedom of the worker. Wage-labour societies emerged from removing the alternative means of self-sustainment used previously by peasants. Historically, whenever people had their own land to cultivate—as was the case for most of the population in pre-industrial England, colonial Kenya, colonial Australia, or colonial Namibia—they did not commit to work for an employer. In such cases, laws were promulgated to expel peasants from their lands, and to make the price of the land artificially high so that a common person would have to work an entire lifetime to buy it.

The second point of criticism is that after people have been compelled to no feasible alternative than that of wage labour, exploitation
Exploitation
This article discusses the term exploitation in the meaning of using something in an unjust or cruel manner.- As unjust benefit :In political economy, economics, and sociology, exploitation involves a persistent social relationship in which certain persons are being mistreated or unfairly used for...

 occurs. The worker is kept in a condition of mere survival, while the wealth produced by his or her work goes to the employer. Also, the technological progress which increases productivity is not used to reduce the work time and improve the quality of life of the worker; instead, it is used entirely to increase the profit of the employer. The employer who buys this labour power as if it were a mere commodity owns the labour process and can sell the products to make profit
Profit (economics)
In economics, the term profit has two related but distinct meanings. Normal profit represents the total opportunity costs of a venture to an entrepreneur or investor, whilst economic profit In economics, the term profit has two related but distinct meanings. Normal profit represents the total...

. On the other hand, the worker sells their creative energy and their liberty
Liberty
Liberty is a moral and political principle, or Right, that identifies the condition in which human beings are able to govern themselves, to behave according to their own free will, and take responsibility for their actions...

 for a given period, and are alienated
Marx's theory of alienation
Marx's theory of alienation , as expressed in the writings of the young Karl Marx , refers to the separation of things that naturally belong together, or to put antagonism between things that are properly in harmony...

 from their own labour, as well as its products.

Wage labour is often criticized as "wage slavery
Wage slavery
Wage slavery refers to a situation where a person's livelihood depends on wages, especially when the dependence is total and immediate. It is a negatively connoted term used to draw an analogy between slavery and wage labor, and to highlight similarities between owning and employing a person...

" by socialists
Socialism
Socialism is an economic system characterized by social ownership of the means of production and cooperative management of the economy; or a political philosophy advocating such a system. "Social ownership" may refer to any one of, or a combination of, the following: cooperative enterprises,...

 and most anarchists
Anarchism
Anarchism is generally defined as the political philosophy which holds the state to be undesirable, unnecessary, and harmful, or alternatively as opposing authority in the conduct of human relations...

. They see wage labour as a major, if not defining, aspect of hierarchical industrial systems. In Marxist terminology, wage labour is defined as "the mode of production
Mode of production
In the writings of Karl Marx and the Marxist theory of historical materialism, a mode of production is a specific combination of:...

where the worker sells their labour power as a commodity
Commodity
In economics, a commodity is the generic term for any marketable item produced to satisfy wants or needs. Economic commodities comprise goods and services....

", (and a wage labourer is one who sells their labour power.)

Opponents of capitalism compare wage labour to slavery (see wage slavery
Wage slavery
Wage slavery refers to a situation where a person's livelihood depends on wages, especially when the dependence is total and immediate. It is a negatively connoted term used to draw an analogy between slavery and wage labor, and to highlight similarities between owning and employing a person...

). For example, Karl Marx
Karl Marx
Karl Heinrich Marx was a German philosopher, economist, sociologist, historian, journalist, and revolutionary socialist. His ideas played a significant role in the development of social science and the socialist political movement...

 said "The slave, together with his labour-power, was sold to his owner once for all... The [wage] labourer, on the other hand, sells his very self, and that by fractions... He [belongs] to the capitalist class; and it is for him... to find a buyer in this capitalist class."

See also

  • Anarcho-Syndicalism
    Anarcho-syndicalism
    Anarcho-syndicalism is a branch of anarchism which focuses on the labour movement. The word syndicalism comes from the French word syndicat which means trade union , from the Latin word syndicus which in turn comes from the Greek word σύνδικος which means caretaker of an issue...

  • Capitalist mode of production
    Capitalist mode of production
    In Marx's critique of political economy, the capitalist mode of production is the production system of capitalist societies, which began in Europe in the 16th century, grew rapidly in Western Europe from the end of the 18th century, and later extended to most of the world...

  • Child labour
  • Compensation of employees
    Compensation of employees
    Compensation of employees is a statistical term used in national accounts, balance of payments statistics and sometimes in corporate accounts as well...

  • Eight-hour day
    Eight-hour day
    The eight-hour day movement or 40-hour week movement, also known as the short-time movement, had its origins in the Industrial Revolution in Britain, where industrial production in large factories transformed working life and imposed long hours and poor working conditions. With working conditions...

  • Employment
    Employment
    Employment is a contract between two parties, one being the employer and the other being the employee. An employee may be defined as:- Employee :...

  • Full Employment
    Full employment
    In macroeconomics, full employment is a condition of the national economy, where all or nearly all persons willing and able to work at the prevailing wages and working conditions are able to do so....

  • Immiseration thesis
    Immiseration thesis
    In Marxist theory, the immiseration thesis refers to the view that the nature of capitalist production logically requires an ever greater reduction in real wages and worsening of working conditions for the proletariat.-Marx:Concerning the evolution of the worker's living conditions, Marx argued...

  • Labour (economics)
  • Labour theory of value
  • List of manual labour tasks
  • Marx's theory of alienation
    Marx's theory of alienation
    Marx's theory of alienation , as expressed in the writings of the young Karl Marx , refers to the separation of things that naturally belong together, or to put antagonism between things that are properly in harmony...

  • Marxian economics
    Marxian economics
    Marxian economics refers to economic theories on the functioning of capitalism based on the works of Karl Marx. Adherents of Marxian economics, particularly in academia, distinguish it from Marxism as a political ideology and sociological theory, arguing that Marx's approach to understanding the...

  • Mode of production
    Mode of production
    In the writings of Karl Marx and the Marxist theory of historical materialism, a mode of production is a specific combination of:...

  • Reserve army of labour
    Reserve army of labour
    Reserve army of labour is a concept in Karl Marx's critique of political economy. It refers basically to the unemployed in capitalist society. It is synonymous with "industrial reserve army" or "relative surplus population", except that the unemployed can be defined as those actually looking for...

  • Rate of exploitation
  • Surplus value
    Surplus value
    Surplus value is a concept used famously by Karl Marx in his critique of political economy. Although Marx did not himself invent the term, he developed the concept...

  • Unfree labour
    Unfree labour
    Unfree labour includes all forms of slavery as well as all other related institutions .-Payment for unfree labour:If payment occurs, it may be in one or more of the following forms:...

  • Wage
    Wage
    A wage is a compensation, usually financial, received by workers in exchange for their labor.Compensation in terms of wages is given to workers and compensation in terms of salary is given to employees...

  • Working poor
    Working poor
    - Definition in the United States :There are several popular definitions of "working poor" in the United States. According to the US Department of Labor, the working poor "are persons who spent at least 27 weeks [in the past year] in the labor force , but whose incomes fell below the official...

  • Wage slavery
    Wage slavery
    Wage slavery refers to a situation where a person's livelihood depends on wages, especially when the dependence is total and immediate. It is a negatively connoted term used to draw an analogy between slavery and wage labor, and to highlight similarities between owning and employing a person...


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