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Wages under Capitalism
 

Wages under Capitalism, a converted form of the value (and consequently of price) of a specific commodity, labour power, i. e., man’s ability to work. The worker sells the capitalist his labour power and gets wages in exchange. Superficially it may seem that it is not labour power that is sold, but its function—labour. Wages appear as payment for work performed. In fact, labour is not a commodity, so it cannot be either bought or sold. If labour were a commodity, it would have a value. But as labour acts as a source and yardstick of value, it itself can have no value. Wages under capitalism conceal the economic dependence of wage workers on the bourgeoisie and mask relations of exploitation. They create the illusion that the worker is paid for all the labour expended, though, in fact, the wages the capitalist pays are at best the price of labour power, while he appropriates the rest of the value produced by the worker in the form of surplus value. Wages conceal that the working day is divided into necessary and surplus labour time (see Necessary Working Time; Surplus Working Time). There are two main forms of wages—time wages and piece wages. In the former, the amount of the worker’s pay depends on the actual time he works; in the latter, on the number of articles produced. The form of wages employed depends on the specific organisational and technological conditions of production and certain social factors (national traditions, the degree of the organisation of the working class, etc.). Time wages can be in the form of hourly, daily, weekly or monthly payments. Time wages enable the capitalist to lower the price of hourly or daily labour and to force the worker to increase working time, or he can prolong working time beyond its normal limits or increase the labour intensity in order to lower the price of a working hour or day. In both cases, the capitalist appropriates increased surplus value. Piece wages constitute a converted form of time wages. On the basis of experience or a time study of the worker’s labour, a work quota is established, i. e., the number of ankles the worker is to produce in an hour or day, working with an average degree of intensity or skill. A piece rate is also established, this being payment to the worker for producing a unit of output, estimated by dividing the hourly (or daily) price of labour by the hourly (or daily) work quota. The daily wages of a piece worker producing one and the same type of product are determined by multiplying the piece rate by the number of articles he produces daily. Piece wages create the impression that the worker’s entire labour embodied in the product is paid for and that the amount of wages is 387 determined exclusively by the worker’s ability. In this way, relations of capitalist exploitation are veiled to an even greater extent. To get higher wages, the worker has to do his job with greater intensity. The capitalist piece-rate system triggers competition among workers and results not only in greater labour intensity, but also in growing unemployment. Piece wages are being replaced by time, wages under the impact of technical progress and the struggle of the working class in some of the developed capitalist countries. Various wage systems exist within the framework of each of the two main forms of wages. For instance, varieties of time wages are the system when two or more rates are established on the basis of the level of output attained by the worker, that of rated daily output, in accordance with which time wages are retained but the initial basic wage of the worker is periodically raised or lowered depending on the level of output and other indicators of labour efficiency reached by the worker over a certain period (three or six months). In the past few years, some workers, first and foremost skilled workers, have been transferred to monthly wages, partly or fully receiving the status of office workers. The so-called sweating systems of piece wages, including piecerecourse and differentiated or charge payment, were especially widespread in the early 20th century. Nowadays these systems have given way to different types of time wages used previously and new systems of piece-rate wages, including “bonus” and multi-factor forms of wages. They make wages dependent on the level of output, the quality of products, savings of raw and other materials, up-time ratio, and adherence to or improvement of the given parameters of the technological process. These systems require an even greater expenditure of physical, nervous and intellectual energy from the workers. The size of payment either remains the same, however, or grows insignificantly. Various types of collective bonus system are also used, given primarily for a rise in labour productivity, frequently in the form of “profit-sharing”. What the workers receive are in fact not their "share of the profits" allegedly parceled out by the capitalists, but part of their own wages, which is paid not regularly but at the capitalists’ discretion, its size depending on the level of declared profits. Capitalist enterprises make use of wage differentials for skill and open or camouflaged discrimination in payment on grounds of sex, age, race, nationality, religion, etc. The sum of money received by the worker for the sale of his labour power is called nominal wages. They should be distinguished from real wages, which are the quantify of use values (goods and services) that the worker can actually buy at a given level of prices with his money wages, after taxation and other deductions. A widespread method of additional exploitation of the working class is the lowering of real wages by raising prices, especially of mass consumption goods, the rent, communal service tariffs, fares and so on, and growing taxation of the working people. This is especially true today, when inflation has reached an unprecedented scale in the capitalist countries. Regarding wages as one of the main items of production costs, capitalists are constantly seeking to reduce them. As a result, wages tend to fall below the value of labour power. The workers struggle to force capitalists to raise them and the outcome of this struggle is eventually determined by the balance of class forces.

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