I spent a lot of years dealing with people and wages. Some of the biggest headaches is wages, raises, hiring, firing. taxes and governmental interference. One of the worst things that would happen was when the government would force a pay increase due to minimum wage increase…
It went like this…
The word went out that on so and so day, minimum wage wold go up. You found out that the new wage was almost exactly the same as you were paying 75% of your people anyway. Wow what a great deal, I was ready for that increase and all is cool…
Wrong… (Numbers are based on ease of understanding and not exact figures!)
People in a service industry many times base there worth on how much above the governmental set standard of minimum wage is. Other words I have been here so long and am so good that I make $1 more than any new person would just starting, but now that a new persons wages are the same as mine are now. I am not special anymore…
Other words: Suzy Q makes $7.25 an hour and she now makes minimum again, just like she did years ago. You would have to give her at least a $1 an hour raise and most likely more due to percentages. Suzy Q is not alone, you have most of your employees in this position, but we have a real serious issue…
But is Timmy worth another increase?
They are most likely worth paying the new minimum wage, because I already paid that wage to them, but they are most likely not worth another dollar+ and hour increase in pay. As they already are productive borderline as it is and in most service industries, employees are not working there because they are the sharpest tack in the box…
You have to also remember that a good 25% of my employees definitely are not worth the increase and they will definitely be replaced as you rejoice over a increase in wages…
So back to the Suzy Q situation, that $1 more than minimum is their status in life and the government just made that status obsolete and most likely made it so that person will lose their job, as I can now hire people at minimum and hope to get a more productive person. At the very least I get a new person at the same rate of pay as the old and no raise for at least a year. The old employee has now been priced out of business…
The sad job of letting Suzy Q go because she is not productive enough is going to happen, no matter what when pay increases become mandatory. A business is in the business to make money and not keep unproductive employees per dollar paid, around as a good will service. A corporation will not accept that as criteria…
A corporation accepts the fact that you need to hire a new employee to replace two or even three old employees…
Firing someone is simple in the work world and any penalties are nominal in the big picture down the road. Most states in America as no-fault working states and that means that you can jet someone go for any reason…
I watch Russia and see these same issues happening…
Another thing that happens when wages are forced to go up is that material items go up immediately, when wage increases are announced. I smiled as I watched increase in food prices coincide with times that Putin announced that retirement benefits would be increased. Every time something is mentioned, prices jump and never go back down, that my friend is capitalism at its worst…
So in America, we give you by force, more money and in return we allow everyone to raise the prices and negate your wage increase and to top it all off, your business that you work at may just decide that you are not productive enough to keep at the new wage and increase, that you feel you need. For you see they also had all the items that they purchase just go up in price and they have to cut corners somewhere…
One of the biggest areas to save money is: Replace Suzy Q with Timmy Doo and he will also do the job of Tammy Too! So I just hired one person to replace two in the long run. A good manager will always be looking for a better employee to replace the lowest productive employees, because your job as a manager depends on the bottom line of any business and employees are one of the easiest places to save a buck…
Two for one is always a good deal at the store when you buy light-bulbs, why not with employees?
This maybe right or wrong in your eyes, but it is a fact and it is the truth. There is always someone who will take your job and do it for less money and do it better for that money they are paid. I never in all my years had a problem finding workers. That next good worker has just walked in the door and wants a job…
I have always taught that a good employee is invaluable and worth the price of any wage, but really how many good employees are there in the world and in this day and age? I took care of my people and paid a fair wage, but I expected you to work and in a service industry, drugs and alcohol rule the roost…
How many really good workers do you get at a McDonald’s, Steak-n-Shake, Frisch’s and Hardy’s + more?
Not many and that is a sad state of affairs in the world…
My grandpa taught me, “It does not matter what you are paid, work as if you are paid the highest wage for what you do! Even if you get only a penny for that work! Always do the best you can at any job!”
I taught my people that and I added this to the end, “There is always someone looking for your job and never forget that!”
Post by Kyle Keeton
Windows to Russia…