Without wanting to refer to another thread too much (...), I did at seeing yet another comment about raising the minimum wage being the answer to poverty.
I'm a small business (co-)owner. Five of our permies are on NMW, the starting point for all employees, with potential raises; having worked on NMW for years myself, I'm a firm believe of retaining people, rather than just hiring cheaply (too short-term thinking for me). Nevertheless, whichever way you look at it, we need fairly unskilled labour - it's warehouse work - packing, sorting, bagging, and preparing labels for shipping. Our work is fairly seasonal, with dips which are mostly predictable. When that happens, and orders are low, I normally focus on doing other things - making sure people are up to date on their training, we usually have a volunteer day which everyone can opt into, permitting extra-long holidays, and so on.
However, in those times we barely break even some years. And although the balance of the busy months makes us profitable overall, I know I'd face huge pressure to let one or two employees go every year if the NMW was put up to a "living wage" suddenly, depending on the length of the dip, or move to some sort of zero-hours contract situation, which I don't want to do.
I'm not sure I'm explaining it properly - but basically I can afford to keep under-utilised employees on full-time in quiet periods if they're paid NMW right now. If I had to pay several pounds more per employee, us "just breaking even" would tip into "making a loss", because the productivity of those employees wouldn't be worth the £8 / £9 (or whatever) it had been raised to.
So, AIBU to think that the posters who claim that "raise the NMW" is the miracle that would end poverty in this country are being quite short-sighted? It seems that way to me.
AIBU?
To wonder why people think "raise the NMW" is the answer to poverty?
windowwashingbanshee · 28/03/2013 16:05
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