SEYMOUR E. HARRIS
Chairman of the Department of Economics, Harvard University
IN OUR society, laws of the market place generally rule. High demand and small supply mean large rewards. Hence the millions for a performer like Frank Sinatra and $135,000 for a major league baseball player like Ted Williams.
But our interests as a nation and even our survival often require values divergent from those fixed by the market. Probably education ought to count for more. We want more able scientists and teachers desperately. But somehow we seem unable, or unwilling, to divert the monetary stream into the appropriate channels, and we pour more money into alcohol and tobacco than we spend for the education of 40 million Americans. No wonder the pay of a head of a distiller’s corporation is close to $400,000; the highest paid college president receives $45,000; the lowest, $1000; and the average, $11,000.
No single explanation of our pattern of rewards is adequate. Certainly costs of preparation do not account for differentials. Professionals with sixteen years of education or more receive about the same income as managers, executives, and others with only twelve years of schooling; and the income of sales and clerical workers, each with an average schooling of twelve years, is roughly equal to that of craftsmen with only nine years of schooling. I once told a group of incoming graduate students in my department that if they were interested in monetary rewards, they had better quit right then; for the A.B. economist (as in many other fields) earns substantially more than the I h.D. economist with from three to four years of additional schooling.
Incomes generally rise in proportion to education, though there are notable exceptions. In fact, the college graduate of 1958, on the basis of expected differentials of income (and with no inflation), can look forward to a lifetime income of $250,000 more than the noncollege graduate. For graduates of Harvard, Yale, Princeton, and other outstanding institutions the differential is even greater. The high rewards to the college trained have persisted despite a tenfold rise in the number of living college graduates in fifty years.
Is organization the explanation of high pay? The high pay of union labor, notably in the entertainment field, may suggest this. But what of the high incomes of doctors, who are not organized into trade unions and who, on the basis of expected incomes, may look forward to a lifetime income of a million dollars from 1958 to 2008? Restrictions of entry into medical schools are relevant here. In both instances the workers profit from artificially induced scarcities.
Perhaps organization of skilled workers with income greatly influenced by productivity in the automated industries helps account for the low average pay of entertainers, just as the organization of nonfaculty employees in colleges tends to depress income of the unorganized faculty: the available income goes disproportionately to those whose incomes respond to market forces and the pressure of union organization. The actors, directors, and others are squeezed, as are the unorganized teachers, by the organized workers sharing the entertainment or educational dollars.
Low pay of teachers is related also to the large number of women in public school teaching. Wherever women predominate, pay is low. In all occupations, men receive 50 per cent higher incomes than women; in the professions, two thirds more. The explanation? Low productivity of women, with a short working life and preference for white-collar jobs; concentration where financial support is beset with obstacles — for example, teaching and nursing; and also male prejudices.
In a capitalist society, supply and demand are supposed to explain everything. When the public wants something badly enough, it pays the price. Compare the incomes of the head football coaches and the college librarians.
The table that follows gives some idea of the paradoxes of the American pay structure.
WHO GETS PAID WHAT
1956-1957 dollars (means “or less”; + means “or more”)
|Accountants||$5100 (census)||7% $2500 -||12% $7000+||Starting salary: $4668 10 years' experience: $9336|
|Airplane pilots and navigators||$7473 (census)||15% $2500 -||32% $7000 +||-|
|Architects: Beginners Maximum age 62||$ 4900-5400 14,000||7% $2500 -||37% $ 7 000+ 6% 18,000- 25,000 7% 25,000+||Census: $6975|
|Authors||$5325||33% $2500 -||26% $7000 +||-|
|Barbers, beauticians, manicurists (female)||$1409||84% $2500 -||0.5% $7000+||Helena Rubenstein has earned more than $25,000,000 in her career as a cosmetician since 1915.|
|Baseball players: Major league||$14,700||$6000||Ted Williams' contract for 1958 was reported to be $135,000.||-|
|Business executives||$70,000 (900 topexecutives)||-||$1,624,000||7% $500,000+ 22% 300,000+ A 1957 survey of Business Week put the top income a t $809,000 — Grace of Bethlehem Steel — and listed 235 with incomes in excess of $100,000. But the census reports 5,377,000 males in the proprietor, manager, official class with a median income of only $5228 in 1955.|
|Clergymen (census)||$3044||49% $2500 -||2% $7000 +||In large churches in large cities, as much as $15,000 or even more.|
|College: Head football coach Librarian Faculty President||$ 6183 5437 5243 11,314||22% $5000 - 38% 5000 - 1% 3000 - 1.5% 5000 -Lowest- 1000||17% $10,000+ 5% 10,000+ 13.3% 10,000+ 0.5% 30,000+ Highest = 45,000||Newspapers reported one football offer of $60,000 in 1957.|
|Compositors (printing)||-||1st shift: $4180 in Parsons, Kan. 3rd shift: 5250 in New Orleans||1st shift: $6337 in Detroit 3rd shift: 6619 in Detroit||-|
|Construction workers: Bricklayers Carpenters Electricians Plumbers All building||Based on union wage rates full-time work:$7240 6260 6680 6700 6440||-||Note: plasterers' full-time pay varies: Atlanta = $4000-6750 Chicago =6800-8150||The census figures are substantially lower because the census definition is more inclusive and the census income figures are based on income actually earned.|
|Dancing teachers and dancers (census)||$3740||22% $ 2500||5% $7000||Ballet dancers’ weekly minimum: New York City = $93 Touring = 98.25|
|Newspaper editors and reporters (census)||$6000||10% $2500||23% $7000+||Top reporters: $20,000; even high as $30,000-40,000. Columnists: as high as $100,000. Hired publishers: as high $100,000.|
|Engineers: In government In education In private industry Employer and owner business||$6600 7100 8400 14,700||5360 (1955 graduates)||$10,350 (1920 1924 graduates)||Census: $6000 A top engineer in private industry: $125,000+.|
|Farmers, foresters, and fishermen (family income)||$1945||62% $2500||4 .9% $ 7 000+ 0 .2% 25,000+||-|
|Government: Federal civil service, professional Federal public administration(census) State public administration (census) Local public administration (census) Governors Mayors: Population 500,000 Population 10,000-25,000 Health officers (public),local||$ 6136 5640 4590 4200 16,900 20,903 2625 10,200||$3410 5% 250 14% 2500 22% 2500 9000 (N.D.) 10,000 50||$14,800 18% 700 10% 700 9% 7000 50.000 (N.Y.) 40.000 8500||-|
|Hucksters and peddlers||$1728||80% $ 2500||1% $7000+||Census)|
|Jan ito rs and sextons||$2632||73% $ 2500||0.2% $7000||-|
|Lawyers||Mean $10,218 Median 7833||5.2% $3000||55.5% $ 7000+ 0.3% 75,000+||Census: $7850 8% 2500 - Leading lawyers in top New York firms: as much as $200,000; some as much as $300,000 01- more.|
|Librarians (female, census)||$3010||50% $ 2500||0.4% $7000||The maximum for director of public library was $17,560 (Boston), with New York not reporting. Maximum salaries for special libraries (for example, commercial) exceed $20,000.|
|Motion pictures: All workers 1st cameraman Laboratory contact man Chief set, electrician Costumer, Class I Musicians||$6325 $16 per hour||$26,150 12,096 13,653 7945||$10,000+||Directors: many as little as 10,000. Perhaps 30 will average over $100,000. Free-lance directors: one gets 300,000 per picture but top average nearer $100,000.|
|Musicians and music teachers (census)||$2850||32% $2500-||11% $7000+||National scale: Phonograph = $41.25 (3 hours) Symphony recordings = $38.50 (3 hours)|
|Newsboys||$392||92% $2500-||0.3% $7000 +||-|
|Nurses (female, census)||$3000||51% $2500-||0.4% $7000+||Basic 8-hour day: Maximum (Calif.) =$15 Minimum (Me. & Miss.) = 10|
|Physicians||$16,017(self-employed)||1% $2500-||2% $75,000+ At least one more than $250,000.||Census: $10,050 14% 2500 - 59% 7000+ Includes salaried practitioners.|
|Social welfare workers (female, census)||$3800||35% $2500-||1% $7000+||-|
|Teachers, school||$4285||$831 (Miss, beginners)||$5200 in 11 years (N.Y.)||Census: $3410 (female) 39% 2 5 0 0 - 0.7% 7000+|
|Television: Producer Staff musician Cameraman||$12,500-115,00013,300 8750||37% $1-499||-||Actor: lead in typical half-hour show, $10,000 frequently and a few at $25,000. For spectacular and other one-time shows, as much as $50,000 or more.|
|Theater — New York Equity actors Musicians — contract house Carpenters, electricians, propertymen||5-year average: Yearly: $800(Average work peryear = 10 weeks; average % membership at work during year=17)Minimum weekly: Specialty act, $2485 lines or less,77.50 148.51 146.95||$4730||0.5% $50,000+||Census figures are much higher than New York Equity figures. At the time covered by Equity, census figures average $2500- 3000. The explanation in part is that income other than that earned in the theater is included in census figures; concentration of numbers is especially high in New York City and hence incomes are especially low.|
|Trade union officers||Mean $18,800 Median 15,000||$3980 in||$64,719||-|
|Truck and tractor drivers||Mean $4640||Southwest||$4860 in Pacific region||Based on 2000-hour year and union rates (1957). Census figure for 1949, adjusted for rise, yields income of $3750.|
This material comes from all kinds of sources: official documents (census and other branches of tire Commerce Department, Department of Labor, Department of Health, Education and Welfare, Congressional Record, congressional hearings), publications of trade associations, letters from experts, municipal year books, trade journals, and so forth. Many figures give only rough approximations but are adequate for comparative purposes.
Census coverage is generally wider than that from other sources and hence tends to yield lower figures. The covciage of professional workers frequently is more extensive (reaching
lowest levels) by the census than in many other studies. I have, therefore, noted where census figures are used.
Where other information was not available, I used census material for 1949, adjusted by appropriate indexes for the rise since 1949 to yield the median for 1956 or 1957. But where the census figures are used, the distribution in each occupation is for 1949. Generally I have used the median (the income of the middle man), and from census sources incomes of males, except where females predominate. I have used census averages for female workers in schoolteaching, nursing, and social work.