Pay differences and the minimum wage

Explain three reasons why some jobs are better paid than others — qualifications and training, level of responsibility, hardship or danger, scarcity of qualified people — and give a real occupation as an example of each.

Besides the basic salary, many payslips add allowances: for length of service, for night work, for dangerous work, for languages. Explain what each one rewards with an example job (a night-shift operator, a technician who certifies her English, a worker with $20$ years in the company) and argue why companies use them to retain and motivate their people.

The statutory minimum wage (SMI) is the legal floor: no full-time worker can be paid less. In Spain, it is around $1.184\ \text{€}$ gross per month spread over $14$ payments.

1. a) Calculate the annual minimum wage.
2. b) A shop offers a full-time job for $1.050\ \text{€}$ per month across $12$ payments: calculate the annual total and explain whether the job offer is legal.

The statutory minimum wage (SMI) is for full-time work: around $1.184\ \text{€}$ gross a month in $14$ payments.

1. a) Calculate the minimum a person hired part-time (half-time) must be paid a month.
2. b) A shop chain offers $4$-hour contracts at $500\ \text{€}$ a month in $12$ payments: calculate the annual total, compare it with what the law requires (half the annual SMI) and say whether the offer is legal.

The government plans to raise the Minimum Interprofessional Wage (SMI) by $10\ \%$. Faced with this announcement, two opposing stances emerge: a hospitality business association claims that the measure will cause massive layoffs and drive up prices in the sector, while a trade union argues that the increase will boost aggregate demand and generate net employment because low-income families will spend that money immediately.

1. a) Using the functioning of the labor market and the concept of marginal propensity to consume, analyze the economic mechanisms that support each of the two stances and explain under what real economic conditions each effect would carry more weight.
2. b) Design a monitoring protocol for the Ministry of Labor with two specific economic indicators that make it possible to assess, after six months, whether the increase has had a contractionary or expansionary impact on employment and the price level in the services sector.

On the payslip of his first job, Alex sees: gross salary $1.300\ \text{€}$, Social Security contributions $85\ \text{€}$, income tax (IRPF) withholding $90\ \text{€}$.

1. a) Calculate the net salary he will receive in his bank account.
2. b) Explain in one sentence what contributions are: what are they paid in exchange for (unemployment, pensions, healthcare)?

Every payslip has three zones: the earnings (what you earn: basic salary, allowances, extra payments), the deductions (contributions and income tax) and the net pay (the net, what reaches the bank).

1. a) Place each item in its zone: night-shift allowance, income tax withholding, basic salary, Social Security contribution, net salary.
2. b) Explain why the gross and the net never match.

Two full-time job offers: (A) gross salary of $1.600\ \text{€}$ with $150\ \text{€}$ in deductions; (B) gross salary of $1.450\ \text{€}$ with $70\ \text{€}$ in deductions and free canteen meals valued at $100\ \text{€}$ per month.

1. a) Calculate the monthly net salary for each offer and add the value of the canteen meals to Offer B.
2. b) Which would you choose? Justify your choice using the numbers and at least one non-monetary factor (working hours, commute distance, work environment).

Two companies offer the same annual salary of $16.800\ \text{€}$: one pays it in $12$ monthly instalments and the other in $14$, with two extra payments in summer and at Christmas.

1. a) Calculate the monthly amount in each case.
2. b) Check that the annual total is the same and argue which system would organise your money better (more each month or two 'treats' a year?).

Company A offers $1.500\ \text{€}$ gross in $12$ payments; company B, $1.250\ \text{€}$ in $14$ payments plus $100\ \text{€}$ a month in meal vouchers.

1. a) Calculate the annual total in money of each offer and the annual value of the vouchers.
2. b) Which is better? Justify it with the numbers and with one non-monetary factor (hours, distance, what they will teach you).

You are offered your first two job opportunities after completing your studies:

• Offer A: $1.600\ \text{€}$ gross per month ($12$ payments). On-site work with a split shift ($9:00$ to $14:00$ and $16:30$ to $19:30$). Distance of $45$ minutes by public transport (travel pass cost: $55\ \text{€}$ per month). Being unable to go home for lunch, you estimate an average expenditure of $9,50\ \text{€}$ per meal on working days ($21$ days per month).

• Offer B: $1.430\ \text{€}$ gross per month ($12$ payments). Continuous intensive workday ($8:00$ to $15:30$), with two days of remote work per week. Distance of $10$ minutes on foot (transport cost: $0\ \text{€}$). Includes certified technical training funded by the company valued at $1.200\ \text{€}$ per year.

1. a) Assuming an average withholding (social security contributions and personal income tax) of $12\ \%$ on the gross salary for both offers, calculate the net monthly disposable income after deducting the unavoidable expenses associated with the position (transport and mandatory food costs).
2. b) Apply the concepts of "opportunity cost", "emotional salary", and "human capital" to justify in a reasoned manner which offer you would choose if your medium-term strategic priority is to maximize your professional development and overall well-being.

A labor audit at a large services company reveals that the average wage of female staff is $14,5\ \%$ lower than that of male staff. However, the Human Resources department demonstrates with payroll records that for every single position, exactly the same base salary is paid to men and women in the same category.

1. a) Resolve the apparent contradiction: explain what structural economic and labor factors (horizontal and vertical segregation, salary bonuses, contract type, and family burdens) explain the existence of this average wage gap without there being a direct violation of equal pay laws for the same position.
2. b) The company plans to allocate its equality budget to offer a voluntary assertiveness and salary negotiation course exclusively for female employees. Critique the effectiveness of this measure and design two organizational labor policies that address the true causes of the gap identified in the previous section.

Following the publication of the salaries of major sports stars, we read in an online debate: "It is a moral disgrace that a First Division footballer earns in a weekend what an emergency room doctor takes four years to earn; this proves that the free market has no economic logic." Carry out a technical analysis of this statement:

1. a) Explain the wage difference using the tools of labor microeconomics: labor supply and demand, relative scarcity of specific talent, audience size, and labor productivity measured by the marginal revenue generated by each professional for their employer.
2. b) Distinguish precisely between the "market price of the labor factor" and the "intrinsic social value of an activity." Argue whether the State should intervene by setting a legal maximum wage for high-earning professions and evaluate the consequences that such a measure would have on brain drain, tax evasion/fraud, and tax revenues compared to an alternative based on progressive income taxes.

In a household, two adults and two minors live together. One of the adults has paid full-time employment, earning a net monthly salary of $1.550\ \text{€}$. The other adult is dedicated full-time to unpaid domestic and caregiving tasks, spending an average of $35$ hours per week on them.

1. a) Calculate the monthly market cost of hiring external personnel to cover those $35$ weekly hours at a rate of $10,50\ \text{€}$ per hour (assume months of $4,3$ weeks). Compare this amount with the household's formal net salary and deduce what percentage of the family's real resources comes from unpaid work.
2. b) Justify why the System of National Accounts excludes these tasks from the official calculation of Gross Domestic Product (GDP), and analyze the economic biases that this exclusion causes when assessing productivity and the female labor force participation rate.
3. c) Design two complementary public policies (one of a fiscal or transfer type, and another of universal public services) aimed at reducing the precariousness and economic dependency of individuals devoted exclusively to unpaid family care.