Critically think about how you can convince owners that doing right by the employees will yield possibly better results for the business.

Assignment Brief

Minimum wage issues in today’s business environment are not just theoretical any longer – The cost of living increases daily yet certain jobs are barely paid at the Federal poverty level – which is where minimum wage is stuck at. The case is designed for you NOT to create schedules and number crunch – it is for you to critically think about how you can convince owners that doing right by the employees will yield possibly better results for the business.

Sample Answer

Minimum Wage Issues in Today’s Business Environment

In today’s world, the cost of living is rising quickly. People are paying more for food, rent, transport, and energy bills. However, many jobs still pay very low wages, sometimes just enough to stay above the poverty line. The minimum wage in many countries, especially at the federal level in places like the United States, has not kept up with this cost of living. This creates a major challenge for both employees and employers.

Why Employers Should Care About Minimum Wage

Many business owners think increasing wages will only hurt their profits. But there is strong evidence that paying fair wages can actually help the business in the long run. Here’s how:

1. Better Employee Retention

When workers are paid fairly, they are more likely to stay in their jobs. Constantly hiring and training new staff costs time and money. Keeping experienced employees saves those costs and keeps service levels high.

Example: Fast food chains like In-N-Out Burger in the US pay more than the minimum wage. They report much lower staff turnover compared to other fast-food competitors.

2. Increased Productivity

Employees who feel valued and respected work harder and with more care. They are more engaged and motivated to do a good job. This leads to higher productivity and better customer service.

Example: Costco is known for paying its staff above the minimum wage. It also outperforms many of its competitors in sales per employee.

3. Improved Company Reputation

Businesses that pay fair wages are seen as ethical and responsible. This can attract more customers who want to support companies that “do the right thing.” A good reputation also attracts better job applicants.

Example: In the UK, the “Living Wage Foundation” recognises employers who pay the real living wage. Many customers and workers are drawn to these companies for ethical reasons.

4. Healthier and Happier Staff

Low wages often mean employees are stressed, tired from working multiple jobs, and unable to afford basic needs. This can lead to sick days and poor performance. Fair pay leads to better well-being and stronger teams.

5. Long-Term Growth Over Short-Term Saving

While raising wages might seem expensive at first, the long-term benefits such as lower turnover, better performance, and improved customer loyalty often lead to higher profits.

Convincing Business Owners

To convince business owners to raise wages, we should focus on these points:

• Show the data: Use real examples and research showing how fair wages benefit productivity and profits.

• Focus on values: Remind them that treating people with fairness is part of good business ethics.

• Start small: Suggest trying higher wages in one department or for a limited time to test the impact.

• Use success stories: Point to companies in the same industry who have benefited from fair pay.

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