The average workers break their backs while the CEOs bag huge rewards: wages need to be distributed based on the workload.
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The average workers break their backs while the CEOs bag huge rewards: wages need to be distributed based on the workload.
Inequality in workers has been in existence since the beginning of capitalism. The issue has been influenced by the employment criteria that have been adopted by various organizations. The recruitment criteria have always been based on qualifications and competence skills (Broecke, 2016). However, academic qualifications have ever been given much weight than other requirements. For this reason, most CEO positions are always taken by the people who are perceived as the most qualified academically. This examines a decrease in wages of CEOs as a strategy to reduce the issue of wage inequality in most countries.
First of all, wage inequality has always been a constrained problem since the pandemic of the Great Depression. According to Neil McCulloch (2018), the issue has remained unsolvable because of two reasons: the first, and the hardest to solve, is that “the very people awarding themselves huge rewards are the same elite that makes the rules.” Most of the critical decisions of the company are made by the CEOs or the board of directors, and they also determine the wages for workers posing a more significant challenge in solving the issue of wage inequality.
On the other hand, there are solutions to this problem; the rich should be taxed more than the poor. Distribution of taxes based on wages earned may be a suitable strategy to mitigate wage inequality in most countries, including the US. The approach may work if some gaps in the government systems and policies have been appropriately addressed. High taxes on the rich may encourage tax evasion by the same rich people who have the power to hire proficient tax accountants. As a result, McCulloch thinks that the issue of wage inequality is not “a technical one but a political one” (McCulloch, 2018).
References
Broecke, S. (2016). Do skills matter for wage inequality?. IZA World of Labor.
McCulloch, N. (2018). Anew year’s resolution to address wage inequality in firms. Future Development. https://www.brookings.edu/blog/future-development/2018/01/08/a-new-years-resolution-to-address-wage-inequality-in-firms/