Karl Marx opens the essay by explaining the common-knowledge definition of wages: Wages are the sum of money a laborer receives from a capitalist in exchange for a certain amount of work—for example, two shillings a day for weaving linen. However, he quickly states that this is not the case and only creates the illusion that wages are equal to the amount of work produced, which benefits the capitalist and masks the exploitation that occurs. Instead, what the laborer sells is their labor-power—in other words, their capacity to work—and the capitalist uses this by putting the laborer to work for an agreed-upon amount of time.

To illustrate that wages are not equal to the work produced, Marx points out that the capitalist doesn’t pay for the workers’ labor-power with the money they make from the products of that labor: The worker has been paid long before the products are ever sold. Instead, the capitalist pays the worker out of the money they have on hand—their capital—which is made up of money they’ve earned selling goods in the past. This means the capitalist buys labor-power in the same way they buy raw materials and other instruments of labor.