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Wednesday, July 17, 2024
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How Businesses Benefit from Raising the Minimum Wage

One reason politicians on both sides fight against raising the minimum wage is that it’ll allegedly hurt small businesses. While forcing business owners to give employees a 20-50% raise sounds like a death sentence, there are many reasons companies big and small stand to benefit from a $15 an hour minimum wage.

The following are some of those reasons:

More Spending Power

Without a living wage, people won’t spend beyond the bare necessities. Right now, the minimum wage keeps people under the poverty line, and that means they can’t spend much and splurge on nice things. Sure, some rich people are out there, but rich people aren’t the people small businesses depend on. It’s the little people who need more cash to spend, and raising the minimum wage will do that. The more you give people, the more they’ll spend, and that’s good for all business owners.

Calmer Workers

Financial stress is real, and it’s something business owners should fear. The problem is they can’t solve this issue on their own because of competition. At the moment, many minimum wage earners depend on same day loans to pay the bills, often relying on these loans several times a year. Worrying about paying off debt accrued through desperation is a recipe for never ending stress and anxiety. By paying workers a higher hourly wage, employers eliminate a major source of angst on the part of their employees. In doing so, they provide themselves a more focused workforce.

Employee Retention

Businesses throughout the country continue to have trouble retaining employees. These folks are always looking for something better because they aren’t getting paid enough. That will no longer be a problem if a business can pay a livable wage. Employees will feel more comfortable working at a company, and that’s a good thing. For instance. Amazon has managed to slow down the employee turnover rate by being one of the first major companies to pay $15 an hour. Keep in mind how much it costs to train new employees. It’s a problem that gets partially solved with a minimum wage increase.

Local Stability

The local economy depends on folks being able to spend. The better the local economy does, the better the small businesses in that area can expect. Successful small businesses may attract new residents to a city. People may move to the area because the community is doing well. People tend to follow prosperity. Not only that, if people keep spending more in one place, then the organization has the means to fund local improvements, such as downtown centers, tourist attractions, and performance venues.

Improved Employee Relations

A minimum wage increase can also help businesses by improving employee relations. Yes, employees who get paid well are more productive, but the relationship between the employer and employee also enhances. Employees are less likely to call in sick or get sick. Stress can sometimes weaken the immune system, and the stress of living below the poverty line even though you work hard is very stressful. Disciplinary issues should also decrease because stress can get some folks to feel frustrated enough to act out, and that’s not good for business.

These are just some reasons businesses small and large need to make their voices heard regarding the minimum wage increase. It doesn’t matter what side you’re on politically. Both have politicians fighting against the increase, and they need to respond to the needs of many people, not just a few.

Hernaldo Turrillo
Hernaldo Turrillo is a writer and author specialised in innovation, AI, DLT, SMEs, trading, investing and new trends in technology and business. He has been working for ztudium group since 2017. He is the editor of openbusinesscouncil.org, tradersdna.com, hedgethink.com, and writes regularly for intelligenthq.com, socialmediacouncil.eu. Hernaldo was born in Spain and finally settled in London, United Kingdom, after a few years of personal growth. Hernaldo finished his Journalism bachelor degree in the University of Seville, Spain, and began working as reporter in the newspaper, Europa Sur, writing about Politics and Society. He also worked as community manager and marketing advisor in Los Barrios, Spain. Innovation, technology, politics and economy are his main interests, with special focus on new trends and ethical projects. He enjoys finding himself getting lost in words, explaining what he understands from the world and helping others. Besides a journalist, he is also a thinker and proactive in digital transformation strategies. Knowledge and ideas have no limits.
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