Join the new world

We have all heard the tune...

"Salaries are too low,
salaries are too high.
Prices are too low,
prices are too high."

Which of those lines are true and which are false?

We have crunched some numbers here at the Freeholder Press and have come up with some answers. We looked at salaries from skills 0 to 7, across all three specializations. We then looked at the cost to purchase basic goods like Q1 or Q2 food, Q1 gifts and Q1 weapons. The idea is to come up with a very rudimentary "cost of living" index.

In all cases the constant factor was working at a Q1 job. So the profile is for newborn, youth or average citizens. All numbers are calculated with before tax income.

Three scenarios were retaine😛
1. Minimal survival, where a citizen only purchases Q1 food not to starve too quickly.
2. Wellness line, where the citizen purchases a Q2 food and a Q1 gift daily.
3. Middle class, where the citizen purchases a Q2 food and a Q1 gift and gun daily.

Finally we took a look at six other international markets to see how Canada compares:
USA, because it's always fun to compare to our closest neighbour and ally.
Poland, the biggest economy and population of the New World.
Spain, the second biggest economy in the New World and rich in high resource regions.
Brazil, recently experienced a baby boom.
Hungary, remains one of the premier powers of the New World.
Turkey, because it is the closest match to Canada in terms of population and economic output.

The results of the international comparison will be published tomorrow.

It is important to note that this is a snapshot in time. This particular sample was taken on Day 875 of the New World.

Basic Profile.

Canada is the 14th economy worldwide. It consistently offers top 8 salaries in international comparison for both construction and manufacturing. In the case of land it is top 4.

The average youth citizen has a 4.5 skill and makes between $7-$10 CAD a day. The salary for a citizen over the course of his first couple weeks is in the $2.40-$3 CAD range. Newborns make between $1.60-$1.80 CAD.



Is Canada affordable?

The average youth citizen will spend 8.7% of his salary just to exist. If he wants to be above the wellness line he is spending 25.8% of his daily income. The best case scenario for Canada is if he is a middle class spender in which case he would be spending 57.7%.

So on an average day our youth citizen would be able to bank between $6.40-$9.10 at the most basic subsistence level, shrinking to $2.95-$4.20 if he decides to arm himself. All that before taxes.

When the same citizen was a little younger, the picture quickly changes. From skills 0 to 2, he is now spending 26.5% of his salary to eat the most basic meals. Being above the wellness line costs him 78.5%. He can no longer buy weapons daily as doing so would require him to spend 175% of his salary.

The newborn citizen, to no one’s surprise, has the hardest time. Eating swallows 41.7% of his salary. He could afford Q2 food but not gifts. Being above the wellness line would require 123.6% of his salary. Buying weapons? The thought shouldn't even cross his mind as the middle class way of life would be a beggaring 276% of his income.

By and large the workers in construction are doing best in present circumstances. Land and manufacturing are similar in the survival scenario but there is an earnings gap between the two at the entry skill levels favouring gatherers.



Should salaries rise or prices fall?

Considering that Canada already offers on average some of the most competitive wages across all skill levels and trade specialization, the culprits appear to be commodity prices. At the time of the snapshot, Q1 food was the most expensive worldwide but Q2 food the 18th cheapest, Q1 gifts were middle of the rankings and Q1 weapons were the 15th most expensive. There definitely appears to be room for improvement there.

The problem is that lowering prices means smaller profit margins for company owners. Margins that in many cases are nonexistent. If those companies did in fact lower prices they would be forced to lower wages by proportional amounts therefore perpetuating the cycle.

Lower raw material costs and better productivity appear to be the only answer. Productivity will increase as the population gains more experience and can be expected. Lowering raw material costs is trickier as that too would affect the salary structure of land employees.

The more you delve into the numbers, the more you realize there is no magic bullet. A nation must make a choice between a dominant activity sector and a balanced approach. The balanced approach will reduce the gap between the standard of living of the various skill specializations but at the cost of a greater proportion of wages invested into your daily life.

As a resource rich nation, we could favour the raw material sector at the cost of construction and manufacturing. Eventually even that policy will create an environment where construction and manufacturing are once again attractive for the cheap labour and the pendulum will swing back.

Look for how we compare to the US, Spain, Poland, Hungary, Brazil and Turkey tomorrow. Do they have the same issues or have they found a different balance?

Time allowing, we may look at how the picture changes with working at higher Q companies and in higher skill ranges.