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Changes in Individual Earnings Over Their Lifetime
Analyse how an individual’s earnings are likely to change over her or his lifetime.
Labor Market and Income Distribution
Frequently asked question
Answer the essay prompt directly and ensure your arguments are relevant to the question.
➡Title: Dynamics of Earnings Over an Individual's Lifetime: A Comprehensive Analysis
🍃Introduction: An individual's earnings tend to undergo significant changes throughout their lifetime. These changes can be influenced by factors such as education, experience, promotions, economic conditions, and age. This essay aims to analyze the likely trajectory of an individual's earnings over their lifetime, considering the initial stages of low earnings, the peak earning years, late-age considerations, retirement, and the impact of gender discrimination.
Changes in Earnings:
➡️1. Early Career Stage: During the initial stages of an individual's career, earnings are likely to be relatively low. This can be attributed to factors such as limited training, lack of experience, lower qualifications, and skills. Individuals in this phase often enter the job market at entry-level positions and are yet to establish themselves professionally. They may also lack opportunities for promotion, leading to stagnant wages.
➡️2. Early Middle-Age: As individuals progress through their careers, their earnings are expected to increase. With accumulating experience, skills, and qualifications, they become more productive and valuable to employers. Higher productivity can lead to promotions, salary raises, and increased responsibilities. In this phase, individuals may also work overtime or take on additional roles to boost their earnings. However, expenses may rise during this period due to commitments like homeownership and supporting a family.
➡️3. Late Career Stage: As individuals approach retirement age, their earnings may fluctuate. On one hand, their experience and expertise can lead to higher earnings as they hold senior positions and command higher salaries. On the other hand, physical and mental fatigue may lead to reduced productivity, and some individuals may opt to work part-time, resulting in lower earnings. Late career earnings can vary depending on factors such as the industry, job flexibility, and individual choices.
➡️4. Retirement: At retirement, individuals typically transition from relying on earned income to relying on other sources of financial support. This may include pension plans, savings, investments, or support from family members. Earnings from employment cease, and individuals rely on accumulated assets or social security systems for financial sustenance.
➡️5. Gender Discrimination: Historically, gender discrimination has influenced earnings disparities between men and women. However, societal shifts and policy interventions aim to reduce gender-based pay gaps. As efforts to promote gender equality progress, women's earnings are expected to increase, narrowing the earnings gap between genders.
👉Conclusion: An individual's earnings are likely to undergo significant changes over their lifetime. Starting with relatively low earnings during the early career stage, earnings tend to increase during the peak earning years as individuals gain experience, skills, and promotions. Late career earnings can vary, influenced by factors such as productivity, flexibility, and individual choices. Retirement marks a transition from earned income to other sources of financial support. Additionally, as gender discrimination diminishes, women's earnings are expected to increase, fostering greater equality in earnings.
Understanding the dynamics of earnings over an individual's lifetime is crucial for policymakers, employers, and individuals themselves. Policies that support education and skill development, promote equal opportunities for advancement, and ensure adequate retirement benefits can contribute to more favorable earnings trajectories and enhance overall economic well-being.
- Explanation of the different stages of earnings throughout an individual's life
- Mention of gender discrimination and its impact on earnings
II. Early Career
- Low earnings due to lack of training, experience, qualifications, and skills
- Unlikely to have been promoted
III. Early Middle-Age
- Higher earnings due to increased productivity from higher skills and experience
- Adding value for employer
- May have been promoted
- Higher expenses due to purchasing a house or supporting children
IV. Late-Age Before Retirement
- Earnings may be high due to experience
- Earnings may be low due to working part-time and being less productive
- Being more tired and less physically fit
- Relying on pension or family for financial support
VI. Gender Discrimination
- Explanation of how gender discrimination impacts earnings
- Mention of how it may fall, increasing a woman's earnings
- Recap of the different stages of earnings throughout an individual's life
- Importance of addressing gender discrimination to ensure fair earnings for all.
• At first an individual’s earnings are likely to be low - they will lack training / experience - low qualifications / skills - unlikely to have been promoted -.
• In early middle-age earnings may be higher - become more productive due to higher skills / experience- adding value for employer - may have been promoted - may work overtime - have higher expenses - e.g. purchase of a house / paying to support children -.
• In late-age before retirement - earnings may be high due to experience - but may be low due to working part-time - being less productive - as being more tired / less physically fit -.
• At retirement - rely on pension / family for financial support -.
• Gender discrimination may fall - so increasing a woman’s earnings -.