Work and Pay, Incomes and Differentials: Employer, Employee and Community

Summary

This report is a concise all-embracing review and analysis of the whole subject of work and pay, in clear and easily understood language. What makes this report so special is that it covers incomes and differentials from the point of view of the owner or employer, from that of the individual and his family and from that of the community, discussing their interests and requirements.

When talking about pay, incomes and differentials, then we are dealing with matters which are at the centre of confrontation and conflict and around which rage controversy and strife. We are dealing with matters which determine how one man stands in relation to another, with something which depends on negotiation and bargaining between those who employ and those who are employed. The result is that almost all one sees about pay and differentials is biased towards one side or the other and both points of view are then equally misleading.

But Manfred Davidmann here provides the underlying knowledge and understanding for scientific determination and prediction of rates of pay, remuneration and differentials, of remuneration scales and of national patterns of pay and differentials.

These correlations and methods represent a major breakthrough and rates of pay, incomes and differentials can be assessed with a high degree of reliability. In this report we see how income depends on the kind of work one does, and on one's skill and expertise. We see how income changes with time and with the economic strength or weakness of a country. Now pay bargaining can include agreeing basic guide-lines of the kind described here as governing pay increases.

Illustrated are National Remuneration Scales which record the remuneration pattern for a group or profession and the position of every individual in it, which also show how income depends on age and degree of success. Illustrated also is the National Remuneration Pattern which is a precise pictorial record of the differentials within a country, from top to bottom, from young to old. Both are used to assess changes in pay, remuneration and differentials for individuals, groups and professions.

Also discussed are merit increases, cost of living increases, betterment increases, job evaluation, salary administration and workforce planning, personal taxation, taxation and social policy.

Contents

Community Leadership and Management
WORK AND PAY.
INCOMES AND DIFFERENTIALS.
EMPLOYER, EMPLOYEE, AND COMMUNITY.

Incomes and Differentials

Individual Incomes

The Cost of Getting Work Done

Job evaluation
Salary administration

Differentials

Personal Taxation

The Changing Incomes Distribution

The Way Ahead

Owners and community
Community's needs
People's needs
Rewarding and restraining
Poverty and differentials
Taxation: A matter of social policy

Appendix 1: Historical Data

Bibliography {..}

Illustrations (Click any illustration to see the full-size chart.)

1. National Remuneration Scale

2. Remuneration Increments: Merit, Cost of Living and Betterment

3. National Remuneration Pattern

4. Pay per Job

5. Salary Scale

6. Salary Administration and Manpower Planning Technique (SAMP)

7 - 10. Remuneration and Income Distributions: Correlation

Relevant Current and Associated Works

Relevant Subject Index Pages and Site Overview

INCOMES AND DIFFERENTIALS

When we are talking about pay, incomes and differentials we are once again dealing with matters which are at the centre of confrontation and conflict and around which rage controversy and strife. We are dealing with matters which determine how one man stands in relation to another, with something which depends on negotiation and bargaining between those who employ and those who are employed. The result is that almost all one sees about pay and differentials is biased towards one side or the other and both points of view are then equally misleading.

However, rates of pay, incomes and differentials can be assessed with a degree of reliability which would appear to be better than that with which engineers build bridges. We know how income depends on the kind of work one does, on one's skill and expertise. We know how it changes with time and with the economic strength of the country. We know how to assess how one man moves in relation to another. Now both sides can see and face facts, can see things as they are so that pay bargaining can include agreeing basic guide lines of the kind described here as governing pay increases.

Work in itself has aspects other than merely earning money, aspects such as contentment, satisfaction and self-development. It includes social contacts and companionship at work. It brings in people in different roles such as employer, employee and customer, and it brings in the community. It brings in relationships between them and corresponding responsibilities.

Pay is related to work done. It is an assessment of the demand for that kind of service, of what one has to pay to get that kind of work done in the circumstances existing at the time. It is determined to a considerable extent by those who determine how much to pay and to whom and for what, by those who hold the purse strings since he who pays the piper calls the tune.

Pay is generally defined relative to work done. The demand for that work determines the amount of pay. Demand exists only when someone is prepared to pay to have the work done. At present the someone is the owner or people at the top whose work gets done.

The community, however, may not be able to pay or see the need to pay and thus its needs may not be met. But its needs have to be met and the extent of the community's need to get certain work done should determine the amount to be paid for it. It is not easy to assess the relative service rendered to the community by people in different positions bearing in mind that a community's needs may change with time. For example, how can one say what should be the differential (if any) between the value of a nurse's work compared with that of a tractor driver, at harvest time and in winter?

Another factor is that pay relates to the individual's need for income, that he sees it in terms which depend on the size of his family and on commitments such as house purchase or children's education.

Relative standing in the community is generally measured in material terms, in terms of income and wealth. Hence in this report we look at incomes and differentials from the point of view of the owner or employer, from that of the community and from that of the individual and his family.

But note that the illustrations included here are historical, reproduced from Manfred Davidmann's published 1982 report, including the first published National Remuneration Pattern for the UK which covered the complete range, from top to bottom, from young to old, as it was in 1968.

INDIVIDUAL INCOMES

The manual employee is paid the negotiated rate for his grade. It is fixed at any particular time in accordance with his trade and grade and does not depend on age {1}.

Other employees such as all levels of managerial, executive, professional and technical staff are paid according to the level at which they work. Their income depends on experience and thus on age. People gain experience and absorb it, applying the lesson learnt one day to work done the next. Their experience continues to increase and as a result so can the responsibility they carry. As responsibility increases, income increases accordingly. Experience, responsibility and remuneration increase as people grow older. But some will be more successful than others depending on their ability and on the opportunities and scope available to them. The pattern of pay for individuals in particular professions or groups is reliably shown by National Remuneration Scales. {1, 2}

People find their level of skill and responsibility while relatively young and from about 25 to 30 years of age onwards their income increases in a well-defined way along so-called 'grade lines'. National Remuneration Scales show this (see Figure 1). The grade lines clearly show how income depends on one's experience and on level of work done. They do this by showing how income depends on age and on degree of success. {1, 2}

The grade lines, including the median line, are accurate as they are based on massive data for the profession's members. The extent to which the data is correlated can be seen from Figures 7 - 8 in Appendix 1.

National Remuneration Scales also show clearly the 'merit' increase which has to be given at each age and level of working, the amount needed to cover the increasing cost of living, and the extent to which one is sharing in the changing national standard of living (see Figure 2). Comparing scales for different years clearly shows to what extent an individual is maintaining his position relative to others of his age working at the same level elsewhere. {1}

The overall pattern, the National Remuneration Pattern, is illustrated by Figure 3 which is the national pattern of incomes and differentials in the UK. The same type of pattern applies throughout the country for all levels of employees. Comparing the National Remuneration Pattern for one year with that of another year clearly shows how different groups or professions have moved relative to each other.

Fig. 1 National Remuneration Scale (UK Directors 1969)		Fig. 2 Remuneration Increments: Merit, Cost of Living, Betterment		Fig. 3 National Remuneration Pattern (UK Median Incomes 1968)

We have now seen how people are paid. What we know is factual and it can be used objectively.

When looking at pay one must also look at the hours worked each week, at the holidays provided and at social insurance payments and benefits provided by employer and by government, as these make up the rate for the person.

Consider two people earning the same amount each week. If one of them has to work twice the number of hours than the other to earn the same amount, then his rate of pay is half and his way of living is very different.

When a man has to have two jobs so as to enable his family merely to exist, or when both husband and wife have to work so as to exist or so as to have merely a reasonable life, then they are in effect exploited.

Incomes increase with age and mostly tail off to a maximum. From the point of view of the individual this means that he is struggling while young and much better off when older. It can be argued that one's income should be higher when young, should be higher while marrying, establishing home, having children and bringing them up.

Present-day government provides and ensures social security benefits and payments also for those who are deprived and for those who are in need. On the other hand we have progressive taxation which takes more from those who have larger incomes and which in this way limits to some extent the pay received by those at the top.

Pay is wage or salary plus any share of profits. It includes fringe benefits such as assistance with house purchase, life insurance, car and travelling expenses. The value of a fringe benefit to the recipient is {3} what he would have to earn (before deducting tax) so as to be left with the value of the fringe benefit after tax has been deducted.

From the point of view of the individual and of the community there should be work for those who want it. There should be equal opportunity dependent only on ability. One job per family should be sufficient to provide its members with a good life. This applies equally well to the young who want to marry and set up home.

Income should cover social needs and depend on the extent to which the individual's work serves the community. On the whole the income patterns are determined by the rate for the job rather than by the needs of the individual or of the community.

THE COST OF GETTING WORK DONE

Owner and employer require work to be done at the lowest rate at which it can be done well and from the point of view of management this means that it should be done at the lowest level in the organisation at which it can be done.

The worth of a job is what has to be paid to get it done. The worth of a job and differentials depend on demand for the particular service in relation to supply of those offering to do the work, and on levels of knowledge and skill, experience and responsibility.

JOB EVALUATION

There are a number of systems of 'job evaluation' for measuring the level of working, such as ranking, grading, points rating or factor comparison. Each can be used to establish an internally consistent system which differs from the others and which ranks different kinds of work on its own scale from low to high levels. Such a system can thus be used to establish a consistent set of time rates and of differentials between them. However, each system rests on subjective assumptions and the results in any particular case depend on the assumptions made.

Difficulties generally arise in due course when fitting many individual rates to the pattern or correlation of rates thrown up by the job evaluation system. One may have to allow for wage rates changing as a result of national and local agreements with unions and employees. Demand and supply also affect the rates of pay.

Different measures of the level of working seem appropriate at different levels, and companies often have separate payment structures for factory and office employees. Job evaluation can be adapted for evaluating managerial work but the evaluation of jobs for senior executives needs to be carried out with care. Figure 4 illustrates results obtained {3} when evaluating the worth of the job at senior executive and director levels. Estimated remunerations are at best within plus or minus 36% of what is being paid to get the job done.

While job evaluation is of little help when considering managerial work, remuneration surveys indicate how levels of pay have increased and help to compare one's own salary scales with those of others.

The higher the level of work, the greater is the salary paid and Figure 5 {1} illustrates the salary scale in an engineering department. There are four levels of position, namely engineer, senior engineer, group manager and the department manager. For each position there is a lower and higher limit of pay corresponding to the kind of work being done by people working at that level. Some work is paid for at the lower level, some at intermediate levels and some at the maximum rate for that position.

Fig. 4 Pay per Job: Comparison Between Calculated and Actual Pay, for Directors and Senior Executives		Fig. 5 Salary Scale: Engineering Department

The manager's skill consists of matching the work which needs to be done to the individuals available to carry it out. He does it by looking at the capabilities of the individual and the size and nature of the work which needs to be done. It stands to reason that a highly skilled engineer being paid at the maximum rate for his position is not asked to do mainly routine work and that an inexperienced newcomer would not be asked to take charge of the largest contract.

So this is a scale of pay which states the range of work which has to be done at each level of position and which states the worth of this work to the employer.

SALARY ADMINISTRATION

On the whole one assesses the demands of the work which needs to be done by an individual, one assesses the individual's capabilities and then compares the two. The individual progresses not merely in accordance with his own ability and increasing experience and skill but in a way which is limited by the scope available to him, by the opportunities for progress within the organisation.

This tends to be a haphazard trial and error way of working and some of the snags are often not appreciated. One comes across particular groups and professions staffed entirely by young enthusiastic and cheap employees suffering from frustration, and high labour turnover results because initial enthusiasm is replaced by frustration within a short period of time as there is only room for one or two of them to move up while the rest remain stuck at the upper salary limit for their position. Only those who cannot find other work stay behind and there often is a lack of continuity of experience which is very marked: the same mistakes are made again and again.

However, there are ways of planning the progress of an individual and matching it to the organisation's needs for getting work done effectively and cheaply which take much of the trial and error out of the situation. I have already described this technique in Salary Administration and Manpower Planning {1}. Quoting from this:

The difference between ability to carry responsibility and that actually carried is a source of frustration or anxiety. An individual will press towards finding work at a level corresponding to his current ability to carry responsibility. If he carries either more or less responsibility he will take steps to decrease or increase it, respectively. He may, for example, press for promotion, change his job, or offload responsibility onto his manager or onto his colleagues.

A person who carries responsibility in accordance with his ability to carry it, and whose responsibility varies as his ability to carry it varies, will be content as far as his work is concerned.

The person whose responsibility varies as his ability to carry it varies and who is paid accordingly, is paid in accordance with his grade line, moves along it as he grows older. This is so because this line shows how he is getting on in relation to his colleagues of the same age elsewhere doing similar work, working at the same level of responsibility. As long as he moves according to his grade line he is doing as well as others of his profession at the same age.

A 'National Remuneration Scale' (see Figure 1) thus shows how individuals progress, remembering that such scales apply to the particular profession or group for which they were drawn up. If an individual falls below his line then he will feel frustrated and look for greater responsibility and correspondingly better pay elsewhere. If he stays on the line he will be content and if he moves above the line he will feel that he is making real progress, that is progress relative to his colleagues, and feel himself to be doing very well indeed, will feel himself advancing.

One matches the rate for the job, that is the worth of the job, with the rate for the man as shown by national remuneration scales. The specific way of doing this, namely by superimposing the two scales on top of each other, is illustrated by Figure 6. This tells one a great deal. The technique is called SAMP which stands for 'Salary Administration and Manpower Planning'.

Fig. 6 Salary Administration and Manpower Planning Technique (SAMP)

This technique enables one to assess a number of important factors and to plan one's professional and managerial manpower to meet the present and future demands of the organisation, to provide continuity of progress and employment and continuity of experience within any one level. It also enables one to assess training needs since it is very clear that those who will hit the upper limit for their position will need to be trained well in advance so as to help them prepare themselves for the work at the higher level which lies ahead. It enables one to assess how long those starting at different ages are likely to remain in that position before they reach the upper limit or retire. In this way the staffing may be planned in a way which benefits both the organisation and those who work in it, with very appreciable gains in morale, that is in greater contentment and dedication to the work of the organisation.

Quoting again from 'Salary Administration and Manpower Planning':

Management wishing to increase productivity by making full use of its employees, should ensure that those employed are engaged in working at the highest level of responsibility which can be carried by them during any particular period. Excessive turnover may be caused by too many young and high grade individuals being engaged on tasks which quickly fail to come up to their ability.

The same considerations apply to almost all levels of staff such as those illustrated and up to the Board of Directors. These considerations assist in planning the staffing of work units to provide necessary replacements and for promotion, and in estimating training requirements.

And also:

Expansion, stability or contraction of the work unit depends on the difference between responsibility carried and the ability of its manager to carry it. Hence staffing may be carried out systematically using SAMP as a guide.

So in this section we have dealt with the way in which the owner and employer looks at pay. He looks at the cost of getting work done, assesses the worth of the job. We also discussed the SAMP technique for staffing, training and manpower planning as this enables one to match the requirements of the employer with those of the employee with the result that both benefit.

DIFFERENTIALS

Some earn more and some earn less and the differential between two people measures how their earnings compare with each other. It can be a direct comparison of either earnings or of the ratio between them. Figure 3 illustrates the pattern of differentials in the United Kingdom at a particular point of time, directly comparing the amounts earned for occupations ranging from manual workers through professional employees up to company directors. The amounts earned include fringe benefits and are median incomes in each occupation, which means that in each age group half earn more and half earn less.

The National Remuneration Pattern (Figure 3) is factual and reliable. It shows the relative value placed on different kinds of work in the United Kingdom. It is largely dependent on the work done and thus determined by the employer. The pattern tends to be applied through national or industry-wide centralised negotiations. The employer's point of view about the rate for the job is not what he can afford to pay but simply is the least he has to pay to get the work done.

At the top are the owners or those who work directly for them, at the bottom is the mass of wage earners.

The employer may or may not offer scope for using one's growing knowledge and experience which would enable one to work at a higher level and thus earn more and prosper, and pressure can be applied through fear of unemployment by the threat of dismissal or by withdrawing financial support, and through competition for promotion which sets people against each other (the rat race).

It is a pattern of differentials which rewards service to the owners and their establishment rather than ability or service to the community. The nurse, the minister, the fireman, the policeman and the teacher are at present paid comparatively little for the work they do.

Those who provide jobs and money have power over those who need to work so as to live. This applies also to those who have the power to give or not to give in government, civil service, and local government. Putting the interests of the owners and of their representatives before that of the community is probably the main cause of our deteriorating environment and of lowering the quality of life. {4, 5, 6}.

In communist countries and similarly in other dictatorships it is adherence to and support of the rulers at the top, and of their establishment which is rewarded by better paid jobs. The establishment is the party or the movement. There is generally no security of tenure. People are more obviously treated just as production units, an example being that young children are supposed to attend nursery schools and kindergartens, not because it is good for the child or its mother, but so as to free the mother for work. Country-wide job evaluation and pay rates fixed centrally depend on the 'state' rather than on the needs of the community and are thus depending on service to and reward from the rulers rather than on the needs of the people.

The basic problem is to find ways of making reward relate to a community's real needs instead of being paid for serving a ruling establishment or those who own and employ. But then what are the 'real needs' at any one time and how does one assess their relative urgency?

In general people should be rewarded in accordance with the benefits which result to the community, perhaps basing the reward on some measure of the benefit, as a result of gains made. It is difficult to find such measures but it can be done.

History shows that it is easier to talk about stopping people from harming and exploiting each other than it is to ensure that they do not. One way of making sure that people do not harm and exploit each other is to make sure that they cannot gain either through manipulation or else through harming people.

When it comes to incomes and wealth one could limit differentials, but then one has to consider just what sort of differential would be both fair and appropriate.

PERSONAL TAXATION

Personal income tax is the usual way found in the Western world of adjusting an individual's contribution to the community according to his income, according to his social commitments and according to the community's needs. The incidence of taxation is a matter of social policy and is not related to the work being done or to how well it is being done.

Higher taxation reduces take-home pay, lower taxation increases it. Hence one way of increasing take-home pay is to pay less tax and effort is sometimes concentrated on increasing take-home pay by reducing the amount of tax one has to pay, is concentrated on providing or demanding fringe benefits.

Fringe benefits are non-taxable personal services or benefits in kind which are provided by the employer.

The value of a fringe benefit is defined {3} as follows:

'The value of a fringe benefit to the recipient is the grossed-up value of the benefit, is the amount he would have had to earn at his highest level of taxation so as to have the value of the benefit remaining after tax has been deducted'.

The value of fringe benefits can be calculated readily {3}. It is cheaper for the employer to increase a well-paid employee's take-home pay through providing tax-free benefits, than to increase his income in accordance with his performance in the job he is doing. It is this which is directing the employer's attention towards providing tax-free benefits rather than towards payment by results.

To well-paid employees, reward then appears to depend on the extent to which tax-free benefits can be found rather than on their performance.

Another investigation into the motivation of company directors {2} confirmed these findings. While income tax and surtax were felt to be highly dissatisfying, only a few directors felt that a reduction in taxation would encourage better performance.

Summing up we can say that the incidence of taxation is a matter of social policy. Those paying high taxes find this highly dissatisfying but reducing taxation does not encourage better performance.

THE CHANGING INCOMES DISTRIBUTION

We have looked at and discussed the pattern of incomes and of differentials in the UK. We also know {7} how incomes are changing, how incomes are distributed among different levels of the population and how additional purchasing power is being shared among the different levels.

This is more than important because a hidden process is taking place by which purchasing power is transferred from the bottom to the top, from those who can least afford to reduce their standard of living to those at the other end to whom the extra purchasing power means greater luxury. Poverty and differentials increase even when there is full employment in an affluent society.

This has been going on for some considerable time and the extent to which it is taking place, the increasing differential between poverty at the bottom and luxury at the top, is undermining the internal strength of our society as those who see themselves in real and in relative poverty complain, demonstrate, organise and disrupt.

It is also important that the earnings of manual employees depend very much on hours worked, that is on the state of the economy, and inequalities are much greater during a time of unemployment, during economic crisis and stagnation.

We need to become aware of processes which redistribute income. We need to see what is actually happening, the extent to which it is taking place, and what the effects are.

Take the UK. The distribution of incomes is changing and we have information {7} about what is taking place. What matters to the individual is his take-home purchasing power which is what his take-home pay will buy after allowing for the increasing cost of living. The ruling level (0.375% of population) took 19.4%, the upper level (1.125% of population) took 28%, and the general population (98.5% of population) took 52.6% of available increase in take-home purchasing power. This unequal sharing out of additional purchasing power had been going on for many years.

Inequality can be defined and measured {7}. 10% of the population were sinking into direct poverty, any gains in income being overtaken by the increasing cost of living. The next 20% were losing out, were being reduced to relative poverty. On the other hand the top 0.4% of the population took gains in take-home purchasing power which were 100 times those received by the general population.

Income tax can be used to adjust the total income from all sources. Appropriate Pay {7} recommends that the top 5% of the population should receive the same large increase in take-home purchasing power, namely that at the 95% level. Surplus money collected as a result should be distributed among the lowest income earners to give each the same increase in take-home purchasing power. It is shown that this would materially affect the lower 25-30% of the population, through reduced taxation or through direct or indirect payments to them, at no additional cost to the government.

The report also makes the following points:

1. Differentials would still continue to increase, those at the top gaining about four times the take-home purchasing power gained by those at the bottom.

2. The adjustments apply only to the extreme income levels in the community. Incentive to do well and reward for good work are not affected by them since rewards for increasing skill, professional excellence, promotion or business success are not affected by the proposed adjustment.

3. Differentials and poverty increase even in an affluent society under full employment as long as attention remains focused on percentage increases instead of on amounts. The same percentage increase means a far greater amount at the top compared with the bottom of the income scale. In this way inflation redistributes take-home purchasing power from the bottom to the top.

   The great and increasing inequality between the well-off and the rest of the population is revealed when one looks at the amounts each receive as their share of the increasing national wealth.

   Amounts are at least as important as percentages, at the bottom as well as at the top of the income scale.

THE WAY AHEAD

We have looked at work and pay from the point of view of:

a) The individual and his family
b) Owner or employer
c) Community.

OWNERS AND COMMUNITY

Pay is generally defined relative to work done. The demand for work determines the amount of pay, where demand exists only when someone is prepared to pay to have the work done. At present the someone is the owner or people at the top whose work gets done.

The community's needs are not met and it is the needs of the community which should determine the amount paid for getting the required work done.

How does one decide or how can one determine what should be the differential (if any) between the value of a nurse's work compared with that of a tractor driver at harvest time and in winter?

COMMUNITY'S NEEDS

The basic problem is to find ways of making reward relate to a community's real needs.

But then what are the 'real needs' at any one time and how does one assess their relative urgency?

PEOPLE'S NEEDS

There should be work for those who want it. There should be equal opportunity dependent only on ability. Income should cover social needs and depend on the extent to which an individual's work serves the community.

We need to pay in all cases at least that amount which is required to keep the employee and his family at a standard of living which is worthwhile striving for.

The individual is struggling while young and much better off when older. It can be argued that one's income should be higher when young, should be higher while marrying, establishing home, having children and bringing them up.

REWARDING AND RESTRAINING

In general people should be rewarded in accordance with the benefits which result to the community, perhaps basing the reward on some measure of the benefit, as a result of gains made.

One way of making sure that people do not harm and exploit each other is to make sure that they cannot gain either through manipulation or else through harming people.

One could limit differentials when one has to consider just what sort of differential would be both fair and appropriate.

POVERTY AND DIFFERENTIALS

Poverty and differentials increase even when there is full employment in an affluent society as long as attention remains focused on percentage increases instead of on amounts. In this way inflation redistributes take-home purchasing power from the bottom to the top.

Amounts are at least as important as percentages, at the bottom as well as at the top of the income scale.

Inequalities increase during a time of unemployment, during economic crisis and stagnation.

Inequality has been defined and measured and the unequal sharing out of additional purchasing power in the UK has been going on for many years. The increasing differential between poverty at the bottom and luxury at the top is undermining the internal strength of our society as those who see themselves in real and in relative poverty complain, demonstrate, organise and disrupt.

A maximum differential of two, the maximum gross remuneration being twice the minimum earnings, both within and between countries, would seem a reasonable target to achieve under present more extreme circumstances.

It would seem reasonable to link reward to results achieved by increasing remuneration at upper levels only after, and in proportion to, increases in minimum income.

TAXATION: A MATTER OF SOCIAL POLICY

The incidence of taxation is a matter of social policy. While those paying high taxes find this dissatisfying, reducing taxation does not encourage better performance.

Negative income tax can be used to adjust the total income from all sources. This can be done effectively in a way which still allows purchasing power to increase at a rate of about four times at the top when compared with the bottom. Incentive to do well and reward for good work are not affected since rewards for increasing skill, professional excellence, promotion or business success are not affected by the proposed adjustment.

Appendix 1

HISTORICAL DATA

The illustrations in this appendix are historical, meaning by this that they are reproduced from Manfred Davidmann's published report which in 1960 reported the correlations and the methods used and discussed the implications of what had been achieved.

The shape of the underlying remuneration distribution for a group or profession does not, as a rule, change with time and it applies to other countries such as the USA.

Much of the work published first by Manfred Davidmann has since been used by others and these correlations and methodology represent a major breakthrough, converting a subjective confrontational system into one in which facts are used to describe reality and in which decisions can be based on facts.

Figs. 7-10 Remuneration and Income Distributions: Correlation

BIBLIOGRAPHY

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