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Wage labour (also wage labor in American English) is the socioeconomic relationship between a worker and an employer, where the worker sells their labour under a formal or informal employment contract. These transactions usually occur in a labour market where wages are market determined. In exchange for the wages paid, the work product generally becomes the undifferentiated property of the employer, except for special cases such as the vesting of intellectual property patents in the United States where patent rights are usually vested in the employee personally responsible for the invention. A wage labourer is a person whose primary means of income is from the selling of his or her labour in this way.
In modern mixed economies such as those of the OECD countries, it is currently the most common form of work arrangement. Although most labour is organised as per this structure, the wage work arrangements of CEOs, professional employees, and professional contract workers are sometimes conflated with class assignments, so that "wage labour" is considered to apply only to unskilled, semi-skilled or manual labour.
The most common form of wage labour currently is ordinary direct, or "full-time", employment in which a free worker sells his or her labour for an indeterminate time (from a few years to the entire career of the worker), in return for a money-wage or salary and a continuing relationship with the employer which it does not in general offer contractors or other irregular staff. However, wage labour takes many other forms, and explicit as opposed to implicit (i.e. conditioned by local labour and tax law) contracts are not uncommon. Economic history shows a great variety of ways in which labour is traded and exchanged. The differences show up in the form of:
- Employment status – a worker could be employed full-time, part-time, or on a casual basis. He or she could be employed for example temporarily for a specific project only, or on a permanent basis. Part-time wage labour could combine with part-time self-employment. The worker could be employed also as an apprentice.
- Civil (legal) status – the worker could for example be a free citizen, an indentured labourer, the subject of forced labour (including some prison or army labour); a worker could be assigned by the political authorities to a task, they could be a semi-slave or a serf bound to the land who is hired out part of the time. So the labour might be performed on a more or less voluntary basis, or on a more or less involuntary basis, in which there are many gradations.
- Method of payment (remuneration or compensation) – The work done could be paid "in cash" (a money-wage) or "in kind" (through receiving goods and/or services), or in the form of "piece rates" where the wage is directly dependent on how much the worker produces. In some cases, the worker might be paid in the form of credit used to buy goods and services, or in the form of stock options or shares in an enterprise.
- Method of hiring – the worker might engage in a labour-contract on his or her own initiative, or he or she might hire out their labour as part of a group. But he or she may also hire out their labour via an intermediary (such as an employment agency) to a third party. In this case, he or she is paid by the intermediary, but works for a third party which pays the intermediary. In some cases, labour is subcontracted several times, with several intermediaries. Another possibility is that the worker is assigned or posted to a job by a political authority, or that an agency hires out a worker to an enterprise together with means of production.
Socialists see wage labour as a major, if not defining, aspect of hierarchical industrial systems. Most opponents of the institution support worker self-management and economic democracy as alternatives to both wage labour and to capitalism. While most opponents of wage labour blame the capitalist owners of the means of production for its existence, most anarchists and other libertarian socialists also hold the state as equally responsible as it exists as a tool utilised by capitalists to subsidise themselves and protect the institution of private ownership of the means of production—which guarantees the concentration of capital among a wealthy elite leaving the majority of the population without access. As some opponents of wage labour take influence from Marxist propositions, many are opposed to private property, but maintain respect for personal property.
A point of criticism is that after people have been compelled by economic necessity to no feasible alternative than that of wage labour, exploitation occurs; thus the claim that wage labour is "voluntary" on the part of the labourer is considered a red herring as the relationship is only entered into due to systemic coercion brought about by the inequality of bargaining power between labour and capital as classes.
Wage labour has long been compared to slavery by socialists. As a result, the term 'wage slavery' is often utilised as a pejorative for wage labour. Similarly, advocates of slavery looked upon the "comparative evils of Slave Society and of Free Society, of slavery to human Masters and slavery to Capital," and proceeded to argue persuasively that wage slavery was actually worse than chattel slavery. Slavery apologists like George Fitzhugh contended that workers only accepted wage labour with the passage of time, as they became "familiarized and inattentive to the infected social atmosphere they continually inhale[d]."
According to Noam Chomsky, analysis of the psychological implications of wage slavery goes back to the Enlightenment era. In his 1791 book On the Limits of State Action, classical liberal thinker Wilhelm von Humboldt explained how "whatever does not spring from a man's free choice, or is only the result of instruction and guidance, does not enter into his very nature; he does not perform it with truly human energies, but merely with mechanical exactness" and so when the labourer works under external control, "we may admire what he does, but we despise what he is." Both the Milgram and Stanford experiments have been found useful in the psychological study of wage-based workplace relations. Additionally, as per anthropologist David Graeber, the earliest wage labour contracts we know about were in fact contracts for the rental of chattel slaves (usually the owner would receive a share of the money, and the slave, another, with which to maintain his or her living expenses.) Such arrangements, according to Graeber, were quite common in New World slavery as well, whether in the United States or Brazil. C. L. R. James argued in The Black Jacobins that most of the techniques of human organisation employed on factory workers during the industrial revolution were first developed on slave plantations.
For Marxists, labour-as-commodity, which is how they regard wage labour, provides a fundamental point of attack against capitalism. "It can be persuasively argued," noted one concerned philosopher, "that the conception of the worker's labour as a commodity confirms Marx's stigmatization of the wage system of private capitalism as 'wage-slavery;' that is, as an instrument of the capitalist's for reducing the worker's condition to that of a slave, if not below it." That this objection is fundamental follows immediately from Marx's conclusion that wage labour is the very foundation of capitalism: "Without a class dependent on wages, the moment individuals confront each other as free persons, there can be no production of surplus value; without the production of surplus-value there can be no capitalist production, and hence no capital and no capitalist!"
- Capitalist mode of production
- Child labour
- Eight-hour day
- Full employment
- Immiseration thesis
- Labour (economics)
- Labour theory of value
- Marx's theory of alienation
- Marxian economics
- Reserve army of labour
- Rate of exploitation
- Surplus value
- Unfree labour
- Wage slavery
- Working class
- Working poor
- Steinfeld 2009, p. 3: "All labor contracts were/are designed legally to bind a worker in one way or another to fulfill the labor obligations the worker has undertaken. That is one of the principal purposes of labor contracts."
- Deakin & Wilkinson 2005.
Marx 1990, p. 1005, defines wage labour succinctly as "the labour of the worker who sells his own labour-power."
- Thompson 1966, p. 599.
- Thompson 1966, p. 912.
- Ostergaard 1997, p. 133.
- Lazonick 1990, p. 37.
- Hallgrimsdottir & Benoit 2007; Roediger 2007a.
The term is not without its critics, as Roediger 2007b, p. 247, notes: "[T]he challenge to loose connections of wage (or white) slavery to chattel slavery was led by Frederick Douglass and other Black, often fugitive, abolitionists. Their challenge was mercilessly concrete. Douglass, who tried out speeches in work places before giving them in halls, was far from unable to speak to or hear white workers, but he and William Wells Brown did challenge metaphors regarding white slavery sharply. They noted, for example, that their escapes from slavery had left job openings and wondered if any white workers wanted to take the jobs."
- Fitzhugh 1857, p. xvi.
- Carsel 1940.
- Marx 1847, Chapter 2.
- Chomsky 1993, p. 19.
- Thye & Lawler 2006.
- Graeber 2004, p. 71.
- Graeber 2007, p. 106.
- Marx 1990, p. 1006: "[L]abour-power, a commodity sold by the worker himself."
- Another one, of course, being the capitalists' theft from workers via surplus-value.
- Nelson 1995, p. 158. This Marxist objection is what motivated Nelson's essay, which argues that labour is not, in fact, a commodity.
- Marx 1990, p. 1005. Emphasis in the original.
See also p. 716: "[T]he capitalist produces [and reproduces] the worker as a wage-labourer. This incessant reproduction, this perpetuation of the worker, is the absolutely necessary condition for capitalist production."
- Carsel, Wilfred (1940). "The Slaveholders' Indictment of Northern Wage Slavery". Journal of Southern History. 6 (4): 504–520. JSTOR 2192167.
- Graeber, David (2004). Fragments of an Anarchist Anthropology. Prickly Paradigm Press. ISBN 978-0-9728196-4-0.
- Graeber, David (2007). Possibilities: Essays on Hierarchy, Rebellion and Desire. AK Press. ISBN 978-1-904859-66-6.
- Hallgrimsdottir, Helga Kristin; Benoit, Cecilia (2007). "From Wage Slaves to Wage Workers: Cultural Opportunity Structures and the Evolution of the Wage Demands of the Knights of Labor and the American Federation of Labor, 1880–1900". Social Forces. 85 (3): 1393–1411. JSTOR 4494978. doi:10.1353/sof.2007.0037.
- Nelson, John O. (1995). "That a Worker's Labour Cannot Be a Commodity". Philosophy. 70 (272): 157–165. JSTOR 3751199. doi:10.1017/s0031819100065359.
- Roediger, David (2007b). "An Outmoded Approach to Labour and Slavery". Labour/Le Travail. 60: 245–250. JSTOR 25149808.
- Steinfeld, Robert (2009). Coercion/Consent in Labor (PDF). COMPAS Working Paper No. 66. Oxford: University of Oxford. Retrieved 3 March 2013.
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- Roediger, David (2007a) . The Wages of Whiteness: Race and the Making of the American Working Class (revised and expanded ed.). London & New York: Verso. ISBN 978-1-844-67145-8.
- Young, John (1997). Peasant Revolution in Ethiopia: The Tigray People's Liberation Front, 1975–1991. Cambridge: Cambridge University Press. ISBN 978-0-521-02606-2.