How A Minimum Wage Increase Affects All Employees

How A Minimum Wage Increase Affects All Employees

Daniel Hall 18/08/2021
How Minimum Wage Increases Affect All Employees

The debate on raising the minimum wage is far from over. While some states have agreed to raise the wage to $15 by 2025, others remain stuck at $7.5.

At the federal level, workers in some states are enjoying improved packages. The sub debates happening inside the bigger story is how the minimum wage could affect employees in an organization. 


Human resources principles indicate that all workers do not earn the same results. It means that an increase in the minimum wage for your employees should reflect a proportional increase for other employees within the ranks. Raising the minimum average fee is like good grades for students when they receive help with uk assignment help, if your employees find out about it, you will immediately increase the efficiency and effectiveness of your company. Here is a look at how an increase in minimum wage will affect the other employees in an organization. 

Demand for Higher Wages

Equity demands that each employee is paid according to his rank. The ranks come with skills, expertise, and experience. When minimum wage increases for workers at the bottom of the HR list, the other workers up the ladder will demand similar increases. 

Organizations respond by increasing wages. Since the wages will come with a higher bill, some employees may be laid off. For small businesses that cannot cope with the salary hike demand, you are likely to see resignations. Some of your best employees may also be poached by your peers in the industry because they can offer more attractive perks. The ripple effect of increasing minimum wage is impossible to predict.  

Improved Performance Reflected up the Line

An increase in minimum wage will result in satisfaction among workers. They begin to see value for their time since they are taking more money home. At the same time, their ability to afford a better life will become enough motivation for employees to work harder. 

As the workers earning a minimum wage deliver better results, their seniors will enjoy better perks. Line managers will see a bulge in their commissions. The increase causes a ripple effect that will be felt throughout the organization. It is one of the reasons small businesses should not worry about increasing the minimum wage. It will result in improved productivity, leaving everyone in the employment line happier. 

More Competition for Higher Positions

Positions higher the HR ladder will become more competitive. The competition will arise out of several indirect effects. As indicated above, businesses will have to improve the perks offered to senior executives. Qualified people lower down the ladder will want to enjoy these perks. 

Improved performance will also result in better commissions. The commission gets better as you rise through the HR ladder. More people will struggle to get to these higher positions because of improved pay. 

Morale to Work Harder

Improved wages are always a morale booster. Considering that minimum wage will come with improved take-home, people will work harder. They can pay more attention in the office or field because there is a reward for improved productivity. 

More hard work will also come from the desire to acquire a higher set of skills. It begins when people have more disposable income in their hands. The disposable income will compel people to further their studies. For example, some employees may take additional courses or get another degree through an assignment writing service uk because they will not have enough time to work and study at the same time. With improved pay, workers have the motivation to work harder. 

Job Satisfaction Resulting in Better Results

Workers around the world are looking for job satisfaction. Many of the people who settle for positions below their pay grades have one leg in and the other leg outside the organization. They are always looking for new ways to earn extra income. If the chance appears, such employees will bolt out of your organization. 

The job satisfaction that comes with an improved minimum wage is immeasurable. The person is sure that his needs are taken care of. As a result, he can focus on the job at hand with all his might. Such a situation will affect every employee up the ladder. 

Satisfied workers are more productive. Line managers will share in the credit arising from increased productivity. As the morale spreads to other people along that chain, the entire organization will experience tremendous growth. 

Reduced Bonuses and Perks for Workers Higher up the Ladder

It is not all organizations that support an increase in the minimum wage. Some businesses may close down because of the high cost of skills. The vote meant to pay workers will now be diverted to the bottom of your employment pyramid.

Supervisors may begin to feel more important yet they are receiving little attention. Until such an organization can enjoy the indirect benefits of improved minimum wage, the news will not be welcomed. 

The attempt to balance the wage bill with productivity will leave some of the seniors frustrated. They might feel that lower grade employees are earning relatively more despite the managers doing more of the management work. Such tussles result in lost talents and the inability to maintain your workforce. 

Focus on Passion Since it is Rewarding

An increase in minimum wage indicates that all skills will begin to pay a decent salary. A worker will not need to choose the better-paying jobs at the expense of passion. More people will turn to talent and passion. 

As people work in places they are more passionate about, productivity improves. They also deliver more insightful solutions, resulting in better ROI. There will be fewer demands to transfer or quit jobs because you are not adequately compensated. 

Any increase in minimum wage will have a huge ripple effect across industries. However, employees up the ladder of increasing their wages will experience positive as well as negative effects. Overall, people become more productive and passionate about work because they are satisfied with the results.

Share this article

Leave your comments

Post comment as a guest

terms and condition.
  • No comments found

Share this article

Daniel Hall

Business Expert

Daniel Hall is an experienced digital marketer, author and world traveller. He spends a lot of his free time flipping through books and learning about a plethora of topics.


Latest Articles

View all
  • Science
  • Technology
  • Companies
  • Environment
  • Global Economy
  • Finance
  • Politics
  • Society