Friday, May 20, 2011

Economics of Lifeguards' High Pay

Just finished skimming a report that Newport Beach (California) is amidst a controversy surrounding the pay of its lifeguards. Apparently a local newspaper researched into the pay of its lifeguards and learned that most of the full-time lifeguards earn well over $100,000 on average. There were even two instances of earning over $200,000! Maybe I should fly out to California and start training to be a lifeguard...

In all seriousness, I think people are being hysterical as usual. Or more likely, the anger is born of envy/jealousy from those who are not so well compensated. I am surprised to hear the 6-figure salaries for lifeguards but, unless there are some fishy shenanigans like Bell City, I see these figures as somewhat justified. $200,000 sounds like too much but half of that is to be expected. As in most things, this can be explained through economics.

In its most basic form, there is a demand for lifeguards at Newport Beach. Considering it is regarded as a wealthy resort, the pay appears reasonable especially if inflation is a factor. There is a positive correlation between factors such as the proximity of the beach to a major city, quality of the beach, and its fame and the number of vacationers. A rule of thumb is, the more vacationers, the more life guards required to be on the beach at any time. However, what we often do not realize is that the more vacationers, the

Lifeguarding is akin to teaching.

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