What factors determine wages and why?

Answer 1

Wages are affected by the costs of production, expenses such as land and materials; the more expensive those are, the less margin is available to create a profit. The available labor pool affects wages because the more people there are competing for a job, the more willing workers are to take a lower wage. Wages earned at other jobs also have an effect because employers need to make their jobs more attractive than others.

Answer 2

Wages are determined by factors such as the supply and demand of labor, the skills and experience of the worker, the level of education and training required for the job, the industry and location of the job, as well as relevant laws and regulations. Ultimately, wages are affected by market forces, bargaining power, and societal norms surrounding compensation.