As of December 31, 2014, minimum wage increased to $8.75 per hour. Not only do you have to update your workplace posters, but this is yet another hurdle for businesses to deal with besides the normal challenges. Over the past few years, businesses had to find a way to stay afloat because of rising fuel costs and everyone’s favorite Obamacare.
Does the increase in minimum wage really help businesses? We all know that there is a certain “cap” you can pay an employee because you cannot recoup the costs on the service or goods you provide. We have seen in some areas like fast food (generally the highest area of minimum wage workers) increase pricing from 30-75% in the last 10 years. Are you really going to pay $10 for a Happy Meal? The problem with increasing minimum wage is it creates more problems than it fixes. Liberals wonder why we are outsourcing jobs to China and here is the answer. Average wage in China is the equivalent of $1.36 per hour according to the Bureau of Labor Statistics. This creates an uneven playing field because US companies have to build in that additional cost.
Employee morale and motivation has also been impacted by the minimum wage increase. Employees who make $10 an hour now see the difference between their salary and minimum wage shrink. So what is going to motivate them to do better and be more productive since there is no benefit to those who contribute the minimum effort for minimum pay? Good employers will not keep employees at minimum wage if they are contributing more than the minimal amount of work. The minimum wage increase has taken the power out of employers' hands to reward employees who go above and beyond.
The country was built on the sweat and tears of small businesses but this seems to be lost on our elected officials. Obamacare, unregulated energy costs, unemployment, workers compensation and minimum wage increase has contributed to the downfall of small business and the American economy. Made in the USA should be an everyday focus not a Patriotic notion on July 4th, Memorial Day and September 11th. Minimum wage for minimum effort, you want to make more be more of an asset to your company.