It’s hard to remember a time when at least some employers did not express concern about bills introduced in our U.S. Congress to increase the federal minimum wage. Wages make up a large part of any employer’s budget, and to have those costs rise suddenly can create economic woes for some businesses. Now that President Obama has made good on his promise to increase the minimum wage for federal contractors to $10.10 per hour, employers are again expressing their concerns.
Still, not all employers are holding the line on wages. Gap Inc. announced on February 19, 2014, that it would raise its lowest wages. Gap joins Costco, Whole Foods Markets, and In-N-Out Burger in voluntarily raising pay for hourly workers. When asked about the move, Gap chairperson and CEO Glenn Murphy explained, “Our decision to invest in frontline employees will directly support our business, and is one that we expect to deliver a return many times over.”
The company’s reasons for increasing minimum wage varied, but each supported strategic ends such as:
- hiring and retaining employees,
- retaining happier workers who better serve customers, and
- increasing demand for goods and services by providing employees with more money to spend.
It will be interesting to see if more large employers increase the minimum wage that they pay to employees. One good way to see what your competition is paying to its workforce is to look at MSEC wage surveys. Click here to learn more about our surveys.