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Old 2012-08-16, 13:31   Link #27
TinyRedLeaf
Moving in circles
 
 
Join Date: Apr 2006
Location: Singapore
Age: 49
Quote:
Originally Posted by Bri View Post
The demand for and valuation of their skills by organizations sets their wage. Simple supply and demand mechanism.
Agreed.

Quote:
Originally Posted by Bri View Post
Organizations simple pay overly high wages in order to maximize the chance of attracting top people with large, solid track-records. The argument is that if they don't pay the highest wages only inferior candidates will apply. The wage premium paid therefore can be seen as an insurance. (I personally don't agree with this reasoning, but it happens)
I don't see why "management" should be valued so much more than any other kind of "talent", especially when high pay is no guarantee against lemons or corruption. In fact, I could also argue that the high pay increases the number of lemons you get simply because you are attracting so many more applicants. Simple law of averages.

So, while every Tom, Dick and Harry graduates hoping to become a banker or a lawyer because of the high pay, relatively fewer talented individuals go to other sectors in the economy. You get a vicious circle in those sectors starved off necessary talent. They atrophy day by day, and with less and less spending power at their disposal, they find it increasingly harder to attract the people they need.

Then what? I guess this is where the society and the economy as a whole needs to decide what to keep and what to let die. On paper, a cut-and-dry affair. In practice, a wrenching issue, when you have to tell someone he doesn't have a job any more because the industry he works in is no longer competitive in that economy.
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