23 September 2014
What do you make of Labour’s proposed increase to the minimum wage? Is it a squeeze on small businesses or a necessary change that should have happened long ago? These are the two arguments I seem to be seeing at the moment and, personally, I would have to agree with the latter.
I just think we’re a civilised society and I’d go as far as to say that the minimum wage should be higher than £8 an hour. If you consider that the average working week is about 40 hours, then surely there should be a plateau that no one should fall below, somewhere between £18,000 and £20,000 a year.
Do I believe this would limit small business? Not really. It’s up to businesses to find ways of making sure that they can pay a living wage. If you can’t afford to pay somebody full time, take somebody on, a marketer for example, for two days a week. There’s no way an increase in the minimum wage will ever stop entrepreneurialism. Entrepreneurial people will always find a way.
Either way, I believe that the current minimum wage is a disgrace. It needs to be enough to make people get up and go to work with a sense of drive and ambition. If you can sit at home and receive benefit support and you could still come out with £12,000, why go to work for £13,000 or £14,000? We’ve got to make it worthwhile for people to work.
Show me an owner of a business who hasn’t factored in that they want more than £20,000 a year. Why should they get so much more than the people working so hard for them? Having said that, it’s worth pointing out that it isn’t, ultimately, all about money. There are other questions to be answered, for example: could the government not change the way you get tax efficient benefits for helping your staff and treating them? You get tax benefits for training your staff but none for things like team trips. It therefore becomes counter-productive to spoil your staff.
I’d love it if the government sat up and said, “Well, actually we’ll help you here.” One thing’s for sure; it would encourage more trade. Can you imagine if business in general, across the board, suddenly spent 10% more in hotels, bars and restaurants, what that would do for the overall economy?
The whole argument comes down to a business owner being able to inspire their troops. And whilst it’s important to focus on trying to pay your employees as much as you possibly can, it means significantly less if those employees aren’t motivated, happy and healthy – mentally and physically. We need to set the bar higher and, as a country, do much more to raise the standards across the board and in all walks of life.