Making a Living in Washington Economic Systems • Economics • The making, selling and buying of goods and services. • Anyone is free to start a • Free business and make or sell Enterprise or goods. Capitalistic system • Owner can keep it or sell it and chooses whom to hire as well as what to pay them. • Must follow government regulations and pay taxes Goods and Services • Needs • Things necessary for survival – food – Clothing – shelter • Wants • Things that make your lifestyle better – Brand name clothes – Books – Cell phones Goods and Services • Goods • Both needs and wants • Some are manufactured – Computer – Skateboards • Some are grown and harvested – – – – Trees Apples Fish Wheat Goods and Services Services • Skills people have due to specialized education that people are willing to pay for. – – – – – – Pilots Doctors/Nurses Plumbers Computer programmers Construction workers Teachers Mrs. Ross’s first teaching gig!) Supply and Demand • Prices of • Best is when supply = demand everything • Supply high X demand low = are driven by surplus = lower prices this – Apple prices • Supply low X demand high = shortage = higher prices – Price of new hot product • Wii • New Nike Jordans So What?? Like it or not, in a few short years you are going to NEED a job just to be able to support your needs…the kind of wants you get depends on what your job pays! Employers can hire whomever they want which makes you part of the supply and demand of the job market. For most jobs right now, supply far outweighs demand! How are you going to stack up to the competition? Paying Employees • Loss • When a business doesn’t make enough money to meet expenses, it’s the amount of money under they are (“In the red”). • What does • No money = No business. No this have to business = No job. No job = no do with me? way to pay YOUR expenses! Paying Employees • Wages • Salaries • Figured by the hour. You work 10 hours you get paid for 10…work 40 hours you get paid for 40. • A set amount that is paid each month, no matter how many hours you work. Paying Employees • Minimum Wage • Set by Federal Government • Applies to 16 yrs and older • Under 16 must be paid 85% of minimum wage. • Federal Minimum wage - $7.25 • WA State Minimum Wage = $9.19 per hour (highest in U.S.) • Profit • The $$ left over after expenses are paid (“In the black”) – Wages – Rent – Taxes CONGRATULATIONS! You just graduated from high school! You are tired of all your parents rules and curfews so you decide to move out so you can be totally independent. You are EXCITED!!!! Your parents will pay for your upcoming college tuition at Highline Community College, but you need to take care of all other living expenses, including college texts (which will cost you $600.00…BUT you have 3 months to save the money, because you have spent everything you have made in the past). Luckily, your best friend wants to do the same thing, so you are going to save a lot of money by being roommates. You have the world by the tail…..or do you? How Well Will You Live? • Statistics Needed – Wage - $9.19 – Job – 35 hrs/wk – Taxes -15% • • • • • • Expenses – Rent $365.00/400.00 – Utilities - $60.00 – Food = $200.00 – Cell phone $60.00 – Gas - $100.00 – Insurance $200.00 • • • How much money do you make a month? What do you have left AFTER TAXES?? How much are your expenses each month? How much money do you have left over after the expenses? How long will it take to save for your books by fall quarter? How do you have to change (pare back) your lifestyle to live on 25 hours pay when school starts? Is this the lifestyle you want to live for the rest of your life? What do you need to do to make sure this doesn’t happen? ANSWERS (on $400.00 rent)! • You make $321.65 and $1286.60 a month • You pay $192.99 in taxes and have $1093.61 after taxes • Total expenses = $1020.00. • You have $73.61 left • Even if I save everything I can’t buy the books I need!!! – What are your “trade offs?” Working Around the State • Major Industries • Agriculture – 1/3+ of WA is used for agriculture • Fishing – aquaculture • Logging – 2nd in the nation for lumber production • Manufacturing – Most important is aircraft, but many others • Electricity – Hydroelectric power sold to other states • Computer – In 2006, Microsoft sold $2.9 billion in software. Who’s Hiring the Most People? • • • • • • • • • • • Boeing Production Plants WSU – WHOO HOO! GO COUGS! Microsoft Sea-Tac Airport Boeing Defense & Space Group UW – Big Puddle of Doggie Drool! South Seattle Community College Virginia Mason Hospital Mary Bridge Children’s Center Tacoma General Hospital Fairchild Air Force Base I want the bling, Man…the BLING!! • Sometimes jobs that need the most workers don’t pay high salaries. • There are a lot of retail jobs, but retail wages are low. – Why? Because selling in stores require little education or training. • Want the big bucks? Jobs that require the most education nearly always pay the highest salaries! – Why? Well, DUH! Highest-Paying Jobs in WA • • • • • • • • • • • • • • • • • Dentists Physicians/Surgeons Optometrists Lawyers Engineering Dept. Mgrs. Mathematics Dept. Mgrs. Natural Sciences Mgrs. Chemical Engineers Dental Hygienists Pharmacists Actuaries Firefighters School Administrators Computer Engineers Electric Power Mgrs. Factory Mgrs Real Estate Brokers What is a Great Job Anyway? • What Workers Want – Steady work with out layoffs – Fair wages – Health Insurance – Paid sick days, vacations, and holidays – Safety in the workplace – Appreciation for good work • What Employers Want – – – – – On time Willing to WORK Careful Trained to do the Job Able to get along with other workers – Able to keep customers satisfied What happens if you can’t make the boss happy? The Global Market • Export • Why is this important to WA and me? • Goods shipped out for sale • The value of WA exports is higher than any other state • One in every 4 jobs in WA depends on international trade! – Boeing airplanes lead WA exports – ½ of wheat exported (mostly to Asia) – Other exports are: computer software, electronics, medicines, aluminum, frozen foods, wines, lumber fruit, fish. The Global Market can be brutal! • Example • WA red delicious apples once commanded a high price overseas. • We were NUMERO UNO in the WORLD!! • Other tastier varieties became more popular. • Labor costs in other countries much lower. • Apples from those countries could be sold at lower prices • Hey! Better tasting AND cheaper? Which are you going to buy? • CHINA NOW THE WORLDS LEADING APPLE PRODUCER AND EXPORTER! The Mighty Dollar • A dollar saved… • How Banks Work • Before banks there were mattresses, fruit jars and holes in your yard • Banks insure safety of your savings up to $100,000.00 • Banks pays you interest to use your money to loan to other people • People who get a loan (with your money the bank is using) get a higher interest rate than you get back. The bank makes money as well as you. Inflation…duh, duh, duh! • Inflation • Blast from the Past • The rate at which prices for everything increase over time. • 55 68 98 10 Gas .23 .34 1.15 3.73 House 11K 14K 130K 232K Min Wage 1.00 1.60 5.50 8.55 Car 2K 3K 17K 30K Av. Inc 4K 7.8K 38K 48K Hamb .30 .50 1.82 4.28 They’ve Got BRING IT!! • Entrepreneur • Debbie Mumm • A person who has a business idea, finds enough capital ($$), and takes the risk of entering the market. • Company Name = Mumm’s the Word • Spokane artist who draws designs used on T-shirts, cookie jars, dishes, etc. • 2000 sales =$90 million Got What it Takes?? • Eddie Bauer • Began selling sporting goods in 1920 • Began with tennis and golf • Business took off when he included fishing tackle and hunting gear • Loved sports and used his experience to help customers find the right gear • Has grown into nation chain of stores as well other endeavors Got What it Takes?? • Armen Tertsagean and Mark Balaban • Creators of Aplets and Cotlets in 1918 • Immigrants from Armenia who started yogurt factory but no one knew what yogurt was then. • So they bought an apple orchard • Used surplus apples to make rabat locoum (Armenian candy) and named the product aplets and cotlets. Got What it Takes?? • Gary Larson • Cartoonist. • Born in Tacoma, lives in Seattle • Creator of “The Far Side” • In 2000 newspapers worldwide • 31 million books have been sold Got What it Takes?? • Chester Carlson • Invented the Xerox machine • Fun Fact: – Xerox means “dry writing” Got What it Takes?? • Bill Gates • Most famous Washingtonian • Cofounder of Microsoft • Started programming when 13 years old • 2nd richest person in the World • A philanthropist!! Got What it Takes?? • Harry Brown and J.C. Haley • Created The Mountain Bar (Cherry Mountain) • Produces 592 bars every minute • Most famous creation is Almond Roca What does it mean to me? “If you wIll lIve today lIke most people won’t, you can live in the future like most people can’t.” Can you Bring it until the future comes?