Blog Post

Do You Know the Immutable Law of Labor?

Shawn Sommerkamp • Feb 23, 2017

Most professionals don't consider exactly why they get paid the amount they receive. Although there are many factors that affect company merit scales, one foundational economic principle is the place to start - The Law of Labor!

Proverbs 22:29 Do you see a man skilled in his work? He will serve before kings!

How Your Wage is Determined

As you explore career growth, in a way that is holy and pleasing to God, take note of a foundational principle in marketplace economics: The Immutable Law of Labor. It proposes the four meaningful factors that determine a wage:

  1. Willingness and ability to do the job
  2. Specialized skills the job requires
  3. Unpleasantness of a job
  4. Demand for services the job fulfills

If there are many people who are willing and able to do the job, the pay is going to be low, e.g. construction workers, administrative assistants, file clerks, school teachers and police officers etc.

Higher Skills Start Off With Higher Salary

The more specialized your skill set is, the higher salary you demand, e.g. electrical engineers, computer programmers, nurses, doctors, technology sales representatives etc.

If the job is unpleasant, then the higher the pay rate will be, e.g. garbage collectors, podiatrists, toll booth operators and crime scene decontaminators etc. In economics, this is known as Compensating Wage Differentials.

Lastly, the rule of supply and demand states that when demand increases, and there is no corresponding increase in supply, price increases. A computer repair person used to make an amazing wage 10 years ago. Demand was answered, and many IT Tech Schools popped up across the U.S. Now, PC-repair is a commodity.

Consider these four points as you make decisions for your own career success. And don’t forget, above all else, pray to God for wisdom and clarity. This pleases our Lord. He will answer.

Shawn Sommerkamp is a motivational speaker and Executive Coach with 20+ years of Fortune 100 leadership experience. He founded Motivationeer™ to coach Christian professionals how to use their career to glorify God and support local church growth.

Schedule a FREE Workshop Today!

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