It is common knowledge that footballers are paid far more than nurses, and the reasons for this can be explained in terms of economic concepts.
The first concept that can help us to understand the pay difference is wage differentials.
Wage differentials explain the differences in pay between various occupations and sectors of the economy. The first differential is the compensating differential. A footballers career is his life, and the two are barely separable. A footballer must live and breathe football, whether it is spending months away during tournaments, or sticking to strict training regimes at home. Whilst is may seem like a very glamorous occupation to the majority, footballers are actually required to devote their entire lives to their careers. Contrastingly, a nurse’s job and their life are very separable. A nurse may work the standard 38-hour week, and then outside of this time the nurse is free, and not constrained by her career. The working hours for a nurse may be far less, and the sacrifices that are required will no doubt be fewer. These differences result in footballers getting paid more to compensate for the increased working hours and sacrifices required.
Another wage differential is the differences in revenue creation. A successful professional footballer could potentially earn a football club a huge amount of revenue through ticket sales and merchandising. A football team consists of just 11 players, yet each game generates millions of pounds in revenue. Many spectators will no doubt have come to the game to witness their favorite player, and this shows that each footballer is crucial in creating a very large amount of revenue for their club. People are willing to pay a lot of money to see footballers display their talent, and it is due to this that they are rewarded with such high pay. Nurses, on the other hand, create very no revenue for the government. Each additional nurse that is employed is an added cost to the taxpayer, and although they are crucial to the National Health Service, individually they create no revenue for the government. This results in nurses getting paid very little.
The third and final differential refers to the differences in skill levels. Footballers require a huge amount of natural ability combined with many years of strict training. Very few people could become a professional footballer even if they wanted to. This means that the demand for professional footballers is very high, and therefore the footballers can demand a very high rate of pay. This also links in with the supply of labor. The supply of professional footballers is very inelastic, as there are huge barriers to entry and there are very few people with the ability required. This means professional footballers are able to demand very high pay rates because both as a reward for having such strong skills, and also because they are very hard to replace. Nurses, however, have a very low demand. Anyone is able to become a nurse with the right training, and there are very few barriers to entry. This means the supply of nurses is elastic, as there is many people with the ability to become nurses, and the barriers to entry are low. This plentiful supply means that nurses receive a very low pay rate, because they are easily replaceable and also do not require anywhere near as strong skills as professional footballers.
Aside from wage differentials, there are other factors that can help us understand the pay differences between professional footballers and nurses. One of these is the concept of a monopsony. A monopsony is a single buyer in a market. Specifically to the labor market, a monopsony refers to a single employer of labor. An example of a monopsony is the government employing nurses. The government is pretty much the sole employer of nurses. This means that a nurses transfer earnings are very low, because they have very few opportunities to transfer into alternative nurse positions. The government can take advantage of this by paying nurses very low salaries. Professional Footballers on the other hand have extremely high transfer earnings. Football clubs are aggressively competing with one another to have the best players. This is, of course, because the better the teams players, the more games the club will win and the more people will come to watch the clubs games, thus resulting in higher revenue. This means that professional footballers have many potential employers, and there are so many clubs that could employ them. This means that football clubs have to pay their players very high salaries in order to prevent them from changing to another team. This pushes a professional footballers economic rent very high; as the football clubs are trying they’re hardest to make the footballers stay at the club.
One final factor that could help to explain the differences in pay is the life of the career. A professional footballers career is very short lived. Professional footballers will often only play professionally for a period of around 8 years. After this, they may have become too old or too unfit to be able to compete with the new, younger generation of footballers. So they may finish their football careers at around the age of 30. As a footballers skills set is so specific, and because they are so occupationally immobile, they may find it very difficult to find new work. This could help explain why footballers get paid so much money, because their entire career is concentrated into a very short period of time, so they get rewarded heavily during that period. A nurse, on the other hand, may have a career life of over 6 times that of a professional footballer. A nurse may start work at age 20, and not retire for 45 years. For this reason, nurses are paid a much lower salary and the life of their career is over a much larger period of time.
To conclude, the differences in pay between professional footballers and nurses can be explained by reference to various economic concepts. These concepts include the wage differentials between the two occupations, the structure of the employers for these occupations and also the life of each occupation.