Applying the formula to the Average Worker.

In my previous post, I developed a very rudimentary method of looking at adjusting wages for wasted hours which could otherwise be used to produce income.

I found an interesting article at the Bureau of Labor Statistics website on average weekly wages from the first quarter of 2005.

US Average: $775/week
California: $872/week
Los Angeles County: $864/week.

For how many hours of work? The International Labour Organization maintains a database called LABORSTA, which I found referenced from the US Bureau of Labor Statistics (and I am inclined to believe it is a good source of data).

According to their data, the average worker in the United States worked 43.6 hours in 2005. Please note: I don't know what methods they used to come up with this number exactly, and how they factored in vacation time, holidays, etc. If you have a better source of data, please post it in a comment. This doesn't include time spent commuting, or being at work on lunch, so I will add another 1.4 hours and make it an even 45 hours.

We'll still run with the 102 available hours. Hours consumed by "raising children" and the like are a personal choice to reduce income and come with opportunity cost, so I won't factor them into the equation.

Unadjusted
US worker: $775 / 45 = $17.22/hour
California: $872 / 45 = $19.38/hour
Los Angeles: $864 / 45 = $19.20/hour

Adjusted
US worker: $775 / 102 = $7.60 x (45 / 102) = $3.35/hour
California: $872 / 102 = $8.55 x (45 / 102) = $3.77/hour
Los Angeles: $864 / 102 = $8.47 x (45 / 102) = $3.74/hour