Frequently Used Terms

Frequently Used Terms

Average Annual Wage Per Employee
Derived from the Covered Employment and Wages (ES-202) program data, the average annual wage per employee is computed by dividing the total annual payroll for any given industry by the average annual employment, based on employment and wages as of the 12th of each month. Annual pay data only approximate annual earnings because an employee may not be employed by the same employer all year or may work for more than one employer.

Average Annual Wage Per Person
Slightly different than the average annual wage per employee, the average annual wage per person is computed using data from the Unemployment Insurance Wage Records database. Unlike the ES-202 program, the Wage Records database includes information about individual workers by Social Security Number. The average annual wage is computed by dividing the total amount of annual wages by the total number of individuals working at any given time.

Complementary
Industries are complementary if they go together. For example, oil & gas extraction requires services of the trucking industry to move equipment and supplies to and from the oil and gas fields. Without trucking services, the oil & gas extraction industry would have a more difficult time functioning. However, the reverse is not necessarily true, as trucking provides services for many other industries, such as Manufacturing and Agriculture, in addition to oil & gas extraction.

Glass Ceiling
Associated with discrimination, it is the pay gap between males and females; the perception that that there is not equal pay for equal work.

Nominal Wage
The dollar amount of wages or earnings; the value of the wage or earnings in current prices for labor.

Out of Labor Force
Refers to individuals not counted as part of official labor force figures. Although these individuals are not working, they are not counted as unemployed because they are either unwilling, unable, or choose not to seek work.

Real Wage
The quantity of goods and services that wages or earnings will actually purchase; a way of accounting for price inflation.

Substitution Effect
Where consumers “buy” their own leisure time by giving up their wages; the wage rate is the “price” of leisure. As the wage rate rises, leisure “costs” more relative to other goods or services that someone might buy. A wage increase is likely to cause people to “buy” less leisure and buy more goods and services with the wages they earn. The substitution effect most likely causes people to want to work more.

Turnover
Derived from the Unemployment Insurance Wage Records database, turnover is the total number of exits divided by the total number of jobs worked at any given time. Under this definition of turnover, temporary and seasonal employees are counted as part of the totals for entries and exits.

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These pages designed by Gayle C. Edlin.
Last modified on by Julie Barnish.