Although some business owners cringe at the idea, mandatory minimum wages are on the rise, and the resulting upward pressure is pushing employers to pay more al the way up and down their entire corporate structure.
Furthermore, with the labor market being as tight as it is – workers are in a position to demand higher wages. The result: Companies are finding it harder than ever to keep wages down.
For employers, paying more for labor doesn’t have to be a bad thing. In fact, it can offer a number of business benefits. Below are a few reasons why your company should get out in front of rising wages and offer higher pay right now.
Why offer a higher hourly wage?
Easier to Recruit Top Talent
Surveys of job seekers regularly show higher pay is a popular reason why people take a new job. If you’re having difficulty getting enough applicants for your open positions, offering higher rates should enough to attract more candidates.
Because minimum-wage laws are going to compel every employer to pay more, boosting your pay right now will make you stand out in the current labor market. Since you’ll be paying more eventually anyway, you can take advantage of the lag time and draw in top talent now.
Higher Job Satisfaction
Research also shows a strong, direct relationship between job satisfaction and productivity. Obviously, your employees will be happier with their jobs if they feel like they are well-compensated.
Paying more also means your employees are more satisfied in their personal lives. Financial challenges are the main source of stress and anxiety for most people. When your staff members are better able to manage their finances, it will support their productivity and work-life balance.
Business owners often express concern that raising minimum wages will mean higher labor costs for their clients and customers, which could hurt their business. There’s no denying that paying higher wages means higher costs, and your company may have to raise prices as a result. However, higher prices don’t necessarily mean losing massive amounts of customers
A 2015 survey from the Hart Resource Association said 75 percent of respondents said they supported raising the minimum wage to a minimum of $12.50 per hour. Given the popularity of higher pay, if your company takes the lead now and increases employees’ pay before being mandated to do so — it can lead to good publicity. When your company is known for taking care of its employees and being a great place to work, that reputation can make you more appealing to prospective customers.
Furthermore, the kinds of staff members who make hourly pay are often public-facing employees. Because these staff members that substantial interaction with customers and prospects, it’s essential that they feel good about your organization, so they can project that feeling to the public.
We Can Work with Your Company to Meet Its Labor Objectives
At Cornerstone, we help our clients meet their overall labor strategy. Please contact us today to find out how we can help your company meet its labor goals.