Definition of Wage Stickiness

Wage Stickiness

Resistance of wages to change.

Stickiness

See price stickiness, wage stickiness.

Benefit Wage Ratio Method

The proportion of total taxable wages for laid off
employees during the measurement period divided by the total payroll during
the period. This calculation is used by states to determine the unemployment
contribution rate to charge employers.

Efficiency Wage

wage that maximizes profits.

Minimum Wage

An hourly wage rate set by the federal government below
which actual hourly wages cannot fall. This rate can be increased by state governments.

Price Stickiness

Resistance of prices to change.

Real Wage

wage expressed in base-year dollars, calculated by dividing the money wage by a price index.

Wage expense

The amount paid to employees for services rendered; synonymous with salary expense and payroll expense.

Wage Flexibility

Ease with which wages adjust in response to excess supply or demand.

Wage/Price Controls

An incomes policy in which wages and prices are constrained by law not to rise by more than a specified percentage.

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