To think raising NMW is a good thing

[Kilot]

The poorest in society will earn more. Companies will have to pay more, benefits will drop.

They're charging more anyway.

Increasing NMW means the lowest earners now have more disposable income. These people now will finally able to arrange desperately needed house improvements, car repairs, new clothes etc. The extra monies paid to them goes straight back into the economy, including back into those businesses

The higher earners are the ones putting their extra monies into their long term investments, sat in bank accounts, 30 year ISAS etc (as well as spending some of course, but you get my point) They accumulate more money than they spend

You give the poorest people more money, the ONLY place it can go is back into the economy

I expect to pay my workers a fair wage. That’s how it works. Share dividends are not guaranteed.

A lot of businesses are one man or a family, no rich shareholders. The number of businesses that pay millions in dividends to shareholders will be miniscule. And in those the shareholders will often be pension funds and such like that ordinary people rely on.

So fuck us low paid workers, right?

It’s not forcing businesses to collapse. It’s forcing the owners and shareholders to give up some of their millions of profits.

This is so naive. There are thousands and thousands of businesses which barely make any profit, but they do keep people employed.

Increasing NMW has already caused mass redundancies

many low paid people will earn diddly squat soon

That's all fine and good except there's a lot of skilled public sector jobs, social work included, which won't be paying much more then minimum wage. As we've seen time and time again recently, appetite for increasing spending on the public sector is not exactly high. I don't disagree with the increase to minimum wage, I just think the argument that companies will pay skilled workers more ignores the public sector aspect and is overly simplistic.

And a lot of those business owners are also on UC, paying as little as they can to themselves and their employees, who are also sustained by UC.

At what point do we say enough is enough? That’s not a viable business, it’s a racketeering front.

I cant work out what i think.

I cant balance wanting to make sure people are paid enough to afford to live with the reality that an employer will want thier employee to provide value to them of the amount of minimum wage. If you dont provide that value, the job doesnt exist anymore.

The higher minimum wage, the more they want from you. When minimum wage fist came in it was for quite low skilled work and it was possible to start out doing entry level stuff and progres. Now it seems for quite skilled work and really hard to pull away from.

Maybe it should be propped up by the state if they are mandating the increase.

But noone would actually go for that because then it comes out of taxpayers pockets collectively. But it's fine for a business.

Fine. But don't moan when big local employers like call centres close down in Britain in favour of cheaper countries.

Or that all your clothing comes from Bangladesh.

Or that your kid is laid off when they are starting a family but they are also about to become more expensive to employ than a younger person.

Or that all older relatives are being cared for by 18 year olds in their first jobs.

Yes, and during that time that 'nobody will do it' what happens? The elderly in care homes left to rot? People in hospital getting no care? Children in danger going even more under the radar?

It just isn't as simple as 'make companies pay everyone more'

Unless businesses just get told they're limited to how much profit they can make?

When NMW is increased those that are paid more hourly take an effective paycut unless their employers are willing to increase too which generally they aren’t. In my NMW job my pay has been increased a few times in the last few years but my managers has been increased by a tiny amount so she effectively earns about 50p an hour more than me now which seems insane

I’m gonna have to lose a member of staff now this on top of everything else. So it’s not good for all workers hey

How about charities/charitable companies that don’t make a profit, have no shareholders but are doing really important work? Not ‘nice to haves’ but essential, statutory work such as health and social care, housing, domestic abuse support and counselling etc? Often these organisations work to support the poorest/most vulnerable with essential services. Funding given by local authorities/trusts/donors is reducing and NI and minimum wage costs affect them too.

I completely get the shareholder profits/big business arguments but the above organisations are also massively affected, so it’s not as easy as ‘greedy shareholders shouldn’t be taking everything’ or ‘don’t run a business if you can’t pay your staff’.

I don’t know what the solution is, but just wanted to give another perspective.

We need to bring back British factories and manufacturing. This is what the government is trying to do with things like paid placements and the motability scheme changes.

Labour are doing that for you
You need to understand that companies need to make a decent profit to make it worthwhile that is why people start a business
no one starts a business for the privilege of employing people

If they do not make a worthwhile profit for themselves they will just make people redundant or close the business

If they cannot afford to pay their workers, they will employ fewer workers, and/or shut down. How does that benefit the working class?

Next time you see a shuttered pub, that used to be the heart of the district, you cna rub your hands and go "Good! Serves them right for not being able to survive in this business environment. Up the workers!"

I see both sides of it in the small business I work for, and honestly I’m torn.

Our lowest paid staff are on NMW, and the increase that we saw in April this year between that and NI was almost unsustainable. The money that we pay out additionally in wage costs, has affected our overall budget and therefore our growth. We work with schools, they were even worse affected by it - a huge amount of TAs are on NMW and school budgets aren’t infinite either.

But - speaking to those people, they’re almost universally struggling with the cost of living. Many of them rely on benefit top ups to get by, and have almost nothing left at the end of the month. They’re asking for more money that isn’t available, and if we looked at universal pay rises for our lowest paid staff, we’d have to employ less of them so someone would end up unemployed.

I do understand that but surely those people also warrant a minimum wage. Oxfam was threatened with strikes last year as it was not paying its staff in the UK enough to live. And that isn’t right is it?

*ETA i didn’t mean to quote!!

I read a thread this morning about ‘middle’ earners being punished in this economy. Actually they were paid more than middle but If they feel they are hard done by how do you think those of us on lower wages feel. I’m now on 5k more than minimum wage after a long NHS specialised career. I can’t get paid more as it’s banded.

I can see both sides of this. But genuinely what is the answer? we pay people less and expect the customer to tip highly like in the USA? The goverment pay more in benefits because people can’t afford to live on low wages? I’m not an economist, i’ve no idea how it can be sorted. But i do see many companies making profits year on year ( not small businesses) I also see small indie hospitality near me opening less hours despite being really busy.

I have never been a business owner . As much as many seem to hate business owners, they have to be viable. If they fold and you just rant on about it being a bad business model so it serves them right that’s people now claiming benefits until they get another job, if ever.

Just listen to it. All the exact same false arguments from the Tory side when NMW was introduced and yet the rich are still getting richer.
😂

Well when you look at it that simply and uncritically...

“I believe it’s rising by 50p an hour? So for a full-time, 40hr/week employee (which most on NMW aren’t) is £20 a week or under £100 a month. If a business can’t absorb that, it’s not viable and being propped up by the state.”

If you are running a people-intensive business on tight margins - much of the hospitality industry, for example - you might well not be able to afford that, so you will shut up shop. Suddenly all your employees are out of work, and far from being better off, they are worse off, as is the country as it has lost the tax they were paying as well as the fact that the workers are now benefit recipients. Put up the price of employment, and nursery fees rise, as does the cost of social care - it will have an impact on everyone, and will prove to be a highly inflationary measure. As for any sort of manufacturing industry, it becomes ever more profitable either to pay for AI machines, or to relocate abroad.

Exactly, it is just silly, people on NMW will end up with the same living standard (increased salary / higher prices) and everybody else is worse off.