Section outline

  • Learning Intentions

    • To explore the ways people earn income.
    • To explore the 'Labour Market' and the relative gains of wealth and income.
    Success Criteria
    • Can describe different types of income and tax.

    Income

    The Labour market is the way in which suppliers of labour (workers) and those that demand (and pay for) labour (businesses) come together to exchange. 

    Consider whether the labour market is fair! Discuss whether Neymar is worth $90 million per year, (Ronaldo $108M and Messi $111M). Explain why you think this. Then discuss whether nurses or less valuable to society than football or basketball players? Discuss whether the pay you receive reflects the value society places on you, or whether it reflects some other factor.

    Answer the questions in the activity on Google Classroom called "Income".

    Types of income   

    Wages are based on an hourly rate multiplied by the number of hours worked. They are often paid for manual work, eg in the building and retail industries.  

    Salaries are stated on a yearly basis, although they are paid in instalments, normally every two weeks. The same amount is paid, no matter how many hours are worked! Teachers, managers, accountants are usually paid this way.

    Independent contracting is when a person with specific skills works for a business to do a specific task, normally for a set period of time and for a set amount of money. At the end of the contract, they find a new contract for a new client. Contractors are viewed as self-employed. 

    Sales commission is a percentage of the value of the product that is paid to the sales person or agent. This is how Real Estate Agents are paid. This provides an incentive to sell lots. Sometimes, you might receive a set wage or salary, with commission paid on top.

    Royalties are similar to commission, but are paid to an author or artist when their text, music, artwork is used. 

    Interest is received when you have savings in a bank or other financial institution. This is a form of income. If you win the lottery and save the money in a bank, you might be able to take out the interest each month and live on this - just!