- 1 Apr 2016
- Reaction score
Look at another scenario; a supermarket increases its lowest paid workers to a level you may consider acceptable. In order to do that, it then increases all its pay scales accordingly (apart from senior management level). Where does the supermarket then recoup its increase in costs? It probably has to increase its prices. The lowest paid, but now better paid employees like to buy their food in the supermarket, but they find their shopping costs them more...........
Should companies be allowed to pay insufficient wages? Lets ask another question: if a high minimum wage is set nationally, if you run a business and cant afford that pay rate, because the business is labour intensive craft based sector, would you employ, put your prices up and watch your turnover nosedive, or would you lay off the staff and source from Vietnam.
Nothing wrong with striving for Utopia, just be realistic about the complications
The paradox at the heart of capitalism.
Company owner A cuts his wages but he requires Company owner B, C etc not to follow suit as in the end aggregate demand would fall.
It's not searching for a Utopia - it's about good economic policies.