Why wages are falling

Day 818, 05:30 • Published in Thailand Thailand • by Jimmy_Miller

The wages offered in both Thailand and the eWorld has fallen a lot over the past month or two; this is of concern to many and is a feature of game dynamics. Wage rates are related to the demand for workers (companies seeking employers) and the supply of labour (citizens seeking a job) – but this has always been the case, what’s changed?

Most company types require 10 employees to be efficient and workers improve their skill each time they work. If all citizens are employed then the increase in companies over the past few months if offset by the increase in the population, that is demand/supply per company can be analysed to compare the changes stripping out the population effect.

A few months ago an average workforce may have been skill 4, each producing 16 units of productivity, now an average workforce has increased, say to skill 5, and hence will produce ¼ more resource, 20 units of productivity. You may think this is a good thing; however it means than 25% more of everything is produced and yet we still only need 5 guns and 1 food each day. What happens to the rest? Essentially it is excess supply and the price has to fall to attract new buyers, such as those who do not usually buy weapons. With less profit wages must fall. This issue will continue to get worse as the game population matures.

The second key factor is that of gold entering and leaving erepublik per citizen. MPP’s have increased in cost, but so too have the number of citizens they provide for, so I will not discuss this issue. The main change has been Lana. Having read many articles on the subject, 1000s of gold leave the game every day to fund training. This is 1000s of gold that is no longer being spent on products. Less demand = Lower prices and lower prices inevitably means lower wages.

The new economic module cannot come quick enough to restore the balance of the eWorld economy, in the mean time try to understand the reasons for wage cuts, lack of pay rises etc. most employers are only doing this because they have too!

Hope you found this article interesting and remember eLife isn’t all bad; appreciate the other initiatives that Thailand is developing such as the mobile military and get involved in the development of our country by joining the irc at #ethai on the rizon server