Wage functions

Wages are that part of the money that goes to consumption. This share of net income depends on the results of teamwork. Between employees, wages are distributed in accordance with the quality and quantity of labor that has been spent, and also depends on the amount of capital invested initially. Based on the definition of this term in the Labor Code, we can identify its main components. So, the structure of wages consists of:

- constant part;

- compensation payments;

- incentive payments.

It can be of two types: real and nominal. The latter represents the total amount of money the worker receives for the work that he invests. And real wages are the volume of services and goods that can be purchased with a nominal salary.

Without it, there can be no question of improving the well-being of every person and the state as a whole. Without material interest, it is impossible to develop and improve production. The following main functions of wages are distinguished:

1. Stimulating. Implementation of this function of wages is necessary, first of all, for the management of the enterprise. It is interested in inducing subordinates to active and effective work, to bestowal. For this purpose, the amount of salary is set depending on the results of each work individually. The more the gap between the personal contribution of an employee and the payment of his labor, the faster his initiative and efforts go.

2. Reproductive. The value of this function of wages is to support and even improve the living conditions of the employee. It is due to the fact that every person should have the opportunity to acquire the most necessary items, raise their children, give them education, that is, to train the labor resources for the future. He must take time off from time to time to keep working. Also, subordinates should be able to raise their culture level.

3. The status. The realization of this function of wages is to increase the status of a person in accordance with an increase in the evaluation of his labor in monetary terms. The main indicator of status is the amount of material compensation. On the fairness of payment, a person can judge by comparing its amount with its own invested efforts.

4. Regulatory. This function affects the relationship between supply and demand in the labor market. It helps to strike a balance between individuals striving for very high pay, and employers who still can not pay much, as their enterprise will become completely unprofitable. To this end, and differentiation of wages by groups of employees.

5. Social. This function, as a rule, continues and complements the reproductive one. This means that wages should not only help to replenish the workforce, but also enable employees to enjoy the basic social benefits: the upbringing of children, education, rest, treatment, cash after retirement.

6. Production-share. This function affects the extent to which living labor is involved in the formation of prices for services and goods, and what is its share in costs and production, and labor. It is important. It determines the cheapness of the labor force or its high cost in the labor market, its ability to compete. At the same time, the lower and higher limits of the established value are strictly observed. In the production-share function through the system of salaries, bonuses, bonuses, through the order of their accrual all the previous functions of wages are realized.