Current Economy & Incentive Pay

In the background of the economy, European debt crisis and United States credit comparison reduced, which effect to global economy getting in to bottom again after 2008. However, in November results showed 12 thousand job opportunity increased and unemployment rate decreased from 9% back to 8.6%. All of this result relate proved that global economy is not as bad as imagination, and it possible will warm up again in next few months.

The unemployment rate is important key to suggest the economy, currently reducing that shows all the company starting hire employees. How to hire correct people or how to incentive pay becomes an important item for all the companies. The simplest way of showing the link between the method of compensation and the work incentives of workers is to compare two widely used pay systems: piece rates and time rates. In believe in piece rates worker are more sensitive to the general economy than time rate workers. When the economy getting bad the most piece rate worker lose their jobs first, because most of them are unskilled or basic workers and company have spent lots money or time on time rate workers already so they would not be that easy to lose their jobs. However this financial crisis effect to bank industry mostly as Bank of America declare they will fire over thirty thousand employees in next few years attempt to save over five billion from labor cost. Besides American labor department U-6 result, which include all of labor force with the people who don't have job and not looking for jobs but have tried to find a job in last past months and the people who are taking a piece rate but they would like change to time rate employee. So the u-6 decrease proved that many company take piece rate workers firstly, and they will be come to a time rates in future.

Only payments are not enough to attract excellent employ from unemployment market, bonuses, profit sharing and team incentives are most important keys. In the test book there is a survey of 500 publicly traded U.S. companies indicated that nearly 38 percent of workers who were not in the management were covered by profit-sharing plans. Profit sharing or bonuses are even more widespread in China. For example my father owns a small manufacture company; they used performance appraisal system to measure every employee. If the worker reach or over their objective will receive bonuses as one month payment that all most for full time workers. Many success employ will receive an annual payment equivalent to one-month's or two-month's pay as profit sharing which depend on the total profit of that year. All of this evidence also suggests that profit sharing plans increase productivity. A high wage makes it costly for workers to shirk and people who are well paid might work harder even if there is no threat of dismissal.

Given more control to employees means let them granted authority over resources, they will have more incentive to worry about