Lost Wages vs. Lost Earning Capacity
These terms describe different damages:
**Lost Wages**
Income you already missed from your job due to the injury. Calculated by your hourly/salary rate times days missed. Relatively straightforward to prove with pay stubs and employer records.
**Lost Earning Capacity**
Your reduced ability to earn income in the future due to permanent limitations from your injury. Includes:
• Future wages you won't earn
• Promotions and raises you won't receive
• Benefits (health insurance, retirement contributions)
• Career advancement opportunities
**Why Earning Capacity Matters More in Serious Injuries**
A 30-year-old earning $75,000/year has 35+ years of remaining work life. With normal career progression, lifetime earnings could exceed $5-10 million. Serious injuries that end careers create massive economic losses.
Our attorneys focus on earning capacity, not just past wages, to maximize catastrophic injury compensation.
**Lost Wages**
Income you already missed from your job due to the injury. Calculated by your hourly/salary rate times days missed. Relatively straightforward to prove with pay stubs and employer records.
**Lost Earning Capacity**
Your reduced ability to earn income in the future due to permanent limitations from your injury. Includes:
• Future wages you won't earn
• Promotions and raises you won't receive
• Benefits (health insurance, retirement contributions)
• Career advancement opportunities
**Why Earning Capacity Matters More in Serious Injuries**
A 30-year-old earning $75,000/year has 35+ years of remaining work life. With normal career progression, lifetime earnings could exceed $5-10 million. Serious injuries that end careers create massive economic losses.
Our attorneys focus on earning capacity, not just past wages, to maximize catastrophic injury compensation.
How Economists Calculate Lost Earning Capacity
Forensic economists use sophisticated analysis:
**Base Earnings**
Starting point is your pre-injury income, including salary, bonuses, overtime, and self-employment earnings.
**Career Trajectory**
Economists project how earnings would have increased through:
• Regular raises
• Promotions
• Job changes
• Industry growth
**Work Life Expectancy**
Statistical tables show how long you would likely have worked based on age, education, and occupation.
**Benefits Valuation**
Employer-provided benefits typically add 20-30% to wage value:
• Health insurance
• Retirement contributions
• Disability insurance
• Life insurance
• Paid leave
**Present Value Calculation**
Future earnings are reduced to present value using appropriate discount rates.
Our serious injury lawyers retain economists with experience testifying in catastrophic injury cases.
**Base Earnings**
Starting point is your pre-injury income, including salary, bonuses, overtime, and self-employment earnings.
**Career Trajectory**
Economists project how earnings would have increased through:
• Regular raises
• Promotions
• Job changes
• Industry growth
**Work Life Expectancy**
Statistical tables show how long you would likely have worked based on age, education, and occupation.
**Benefits Valuation**
Employer-provided benefits typically add 20-30% to wage value:
• Health insurance
• Retirement contributions
• Disability insurance
• Life insurance
• Paid leave
**Present Value Calculation**
Future earnings are reduced to present value using appropriate discount rates.
Our serious injury lawyers retain economists with experience testifying in catastrophic injury cases.
Vocational Rehabilitation Expert Testimony
Vocational experts assess work limitations:
**Functional Capacity Evaluation**
Assessing physical abilities after injury:
• Lifting capacity
• Standing/sitting tolerance
• Fine motor skills
• Cognitive function
**Transferable Skills Analysis**
Determining what jobs you can still perform with your limitations.
**Labor Market Survey**
Researching available jobs and wages in your geographic area.
**Earnings Comparison**
• Pre-injury earning potential
• Post-injury earning potential
• The difference is your lost earning capacity
**Retraining Assessment**
Evaluating whether education or training could improve post-injury earning potential.
Vocational experts work with economists to provide comprehensive earning capacity analysis.
**Functional Capacity Evaluation**
Assessing physical abilities after injury:
• Lifting capacity
• Standing/sitting tolerance
• Fine motor skills
• Cognitive function
**Transferable Skills Analysis**
Determining what jobs you can still perform with your limitations.
**Labor Market Survey**
Researching available jobs and wages in your geographic area.
**Earnings Comparison**
• Pre-injury earning potential
• Post-injury earning potential
• The difference is your lost earning capacity
**Retraining Assessment**
Evaluating whether education or training could improve post-injury earning potential.
Vocational experts work with economists to provide comprehensive earning capacity analysis.
Proving Lost Earning Capacity
Documenting earning capacity loss requires thorough evidence:
**Employment Records**
• Tax returns
• W-2s and 1099s
• Performance reviews
• Promotion history
• Salary surveys for your occupation
**Medical Evidence**
• Permanent restrictions documentation
• Functional capacity evaluations
• Physician work status reports
• Prognosis for improvement
**Expert Testimony**
• Economist calculating lost earnings
• Vocational expert on work limitations
• Treating physicians on restrictions
**Education and Training Records**
• Degrees and certifications
• Specialized training
• Career development plans
**Industry Data**
• Average earnings in your field
• Career advancement patterns
• Industry growth projections
Our attorneys build comprehensive earning capacity cases through thorough documentation and qualified experts.
**Employment Records**
• Tax returns
• W-2s and 1099s
• Performance reviews
• Promotion history
• Salary surveys for your occupation
**Medical Evidence**
• Permanent restrictions documentation
• Functional capacity evaluations
• Physician work status reports
• Prognosis for improvement
**Expert Testimony**
• Economist calculating lost earnings
• Vocational expert on work limitations
• Treating physicians on restrictions
**Education and Training Records**
• Degrees and certifications
• Specialized training
• Career development plans
**Industry Data**
• Average earnings in your field
• Career advancement patterns
• Industry growth projections
Our attorneys build comprehensive earning capacity cases through thorough documentation and qualified experts.
Common Defense Challenges to Earning Capacity Claims
Insurance companies attack earning capacity calculations:
**"You Can Still Work"**
Defense experts often claim victims can return to work or find alternative employment. Our vocational experts document real-world limitations.
**Pre-Existing Conditions**
Insurers argue prior health issues limited earning potential. We distinguish pre-injury capacity from post-injury limitations.
**Job Availability**
Defense economists may claim jobs exist that victims cannot actually perform. Labor market surveys address realistic opportunities.
**Inflated Projections**
Defense challenges earning growth assumptions. Our economists use conservative, well-supported projections.
**Statistical Manipulation**
Different discount rates and assumptions dramatically affect present value. We ensure fair, accurate calculations.
Our serious injury lawyers anticipate and counter these challenges with credible expert testimony.
**"You Can Still Work"**
Defense experts often claim victims can return to work or find alternative employment. Our vocational experts document real-world limitations.
**Pre-Existing Conditions**
Insurers argue prior health issues limited earning potential. We distinguish pre-injury capacity from post-injury limitations.
**Job Availability**
Defense economists may claim jobs exist that victims cannot actually perform. Labor market surveys address realistic opportunities.
**Inflated Projections**
Defense challenges earning growth assumptions. Our economists use conservative, well-supported projections.
**Statistical Manipulation**
Different discount rates and assumptions dramatically affect present value. We ensure fair, accurate calculations.
Our serious injury lawyers anticipate and counter these challenges with credible expert testimony.