Wage Drift

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Description of Wage Drift. Explanation.


Definition Wage Drift. Description.

Wage Drift is an economic term that refers to the difference between basic pay and total earnings. Wage drift consists of things such as overtime payments, bonuses, profit share and performance-related pay.

It usually increases during periods of strong growth and declines during an economic downturn. Other situations that are conducive to wage drift are that sometimes workers in cities get paid more to meet the higher cost of living, in spite of equal-opportunities legislation women still tend to earn less, older workers tend to earn more because they are paid a bonus to reward their experience, and some workers are paid more for working harder.

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