Why do people who work the hardest earn the least?

[Anonymous]

[MrOracle]

Hard work is a COMPONENT - and an important component - of overall value, but it isn't the only component. The people who earn the most are those who have skills that are highly in demand, in short supply, and are difficult to duplicate. Sweeping a floor or digging a ditch is hard work, but anyone can do them, so it's easy to duplicate such a worker, so the value of that work goes down. Building wagon wheels is highly-skilled work, but the demand for wagon wheels is quite low, so only a handful of these jobs exist, and adding more jobs would lower the per-worker value of the job. We're going to see this problem hit internal combustion vehicles - as the market transitions to electric vehicles, people who are experts on gas and diesel engine and transmission design are going to see the value of their jobs erode away, even though those jobs pay a lot now.

GENERALLY, a person's pay is related to the value they bring to the company they work for. A person who can generate $20M in sales for the company, or who can bring in a new design that saves the company $20M a year, then they're going to be able to demand a high salary. A person who works the soda fountain at a fast-food restaurant and generates $30,000 in gross annual sales for that restaurant isn't going to be able to demand nearly as much, especially since that job is also easily to replicate.

Both people have to work hard to succeed at all, but the highly-paid people not only had to invest in acquiring skills that the lower-paid people did not, but they had to invest in skills that were IN DEMAND. A person can invest a lot of time and money learning a skill that is NOT in demand - and it's still expensive and difficult to acquire those skills - but it probably won't pay off salary-wise. If you want a high salary, you need to learn skills that are not only currently in demand but that are likely to be in demand for the foreseeable future - which means you need to have a good handle on the industries that use those skills and the likely future state of those industries.

If all you can do is dig ditches, and you can't or won't develop more valuable skills, then you might always have a job (at least, until your body fails you), but you'll never have a high salary.

[jennifer_bloom]

Work builds character but to build wealth work must be combined with wisdom and knowledge and opportunity and experience. Some people do not have the spare time that they need to cultivate the soft skills that help them get job promotions, or the compulsory skills that help them change their line of work.

[Anonymous]

The least of what? Money?

[Anonymous]

I don’t think that’s always the case

[Anonymous]

It's the way of the world.