The New Zealand Herald reported last week:
It’s not often you get a chance to relocate to a coastal town with a beautiful white sand beach along with a whopping pay rise.
But that’s exactly what is on offer, and it’s right on Kiwis’ doorstep - sort of.
Western Australian beachside community Bremer Bay is offering one lucky person an eye-watering $300,000 to $450,000 wage, a rent-free five-bedroom home and a car if they relocate to their remote town.
So what does the job entail?
Bremer Bay, located on the south coast between Albany and Esperance, is in desperate need a new general practitioner (GP).
According to Indeed, the average Australian GP earns an annual salary of $233,304.
As I've noted before, when a job offers a pay package that is far higher than elsewhere, you ought to be thinking: what's wrong with this job? There must be something about the job that means the employer has to pay a much higher salary in order to attract people to work there.
Wages differ for the same job in different firms or locations. Consider the same job in two different locations. If the job in the first location has attractive non-monetary characteristics (e.g. it is in an area that has high amenity value, where people like to live), then more people will be willing to do that job. This leads to a higher supply of labour for that job, which leads to lower equilibrium wages. In contrast, if the job in the second area has negative non-monetary characteristics (e.g. it is in an area with lower amenity value, where fewer people like to live), then fewer people will be willing to do that job. This leads to a lower supply of labour for that job, which leads to higher equilibrium wages. The difference in wages between the attractive job that lots of people want to do and the unattractive job that fewer people want to do is called a compensating differential.
Is the high salary on offer for a GP in Bremer Bay a compensating differential? Consider this:
Bremer Bay is a five-and-a-half hour drive from Perth and as of 2021 had a population of just over 200.
Over the past 10 years, the beachside town’s population has swelled as high as 6500 people during the Christmas and holiday periods.
The successful applicant will be the only GP in a rural community that's a long way from urban amenities (that might be a positive aspect for some people, but negative for many). However, being the only GP for 6500 people during summer has to be a strong downside. A beachside job sounds great, but if you spend your summer working flat out instead of enjoying the sun, that kind of destroys the positive aspect of it. And that is probably why the town is having trouble attracting anyone for this position, and why they have to offer such a high salary.
Read more:
No comments:
Post a Comment