Monday, June 19, 2017

What happens when you pay far above minimum wage?

Seattle is phasing in a $15 minimum wage and they are modeling and gathering data to see if this is helping or hurting businesses and those at the bottom of the ladder. So far, the impact on business has been "negligible".

Contrary to the simple supply-and-demand theory, higher minimum wages, Allegretto says, may end up saving companies money in the long run. “We know that turnover decreases when you increase minimum wages,” she says. “If companies invest more in their workers, the workers are going to be more satisfied. In industries like the restaurant industry, where the turnover rate is sometimes above 100% in a year, that’s a lot of money to spend on recruiting and training and re-recruiting constantly,” Allegretto says.

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