In the contemporary world, there is an increase in the number of individuals fighting for the minority of workers’ salaries. While raising the standard wage can bring several benefits such as decreasing poverty and improving productivity and morale, it might cause adversities regarding employment and inflation. In the following essay, both merits and demerits of this phenomenon will be discussed.
On the one hand, it is understandable why raising the workers’ income induces several beneficial outcomes. The most important of these is the reduction of poverty. Particularly, higher salaries could lift a wide range of employees out of poverty, and they can improve the quality of their lives without reliance on grants from the government. This leads to the mitigation of financial burdens in local authorities. Otherwise, with more disposable income comes the promotion of productivity. Admittedly, higher wages paid could make employees feel more satisfied, resulting in more sustainable retention and the enhancement of work-rate since workers become more valuable.
On the other hand, there are several downsides induced when it comes to the rise of workers’ salaries. The first point supporting this idea is the ratio of unemployment. To be more specific, companies tend to reduce a large number of low-skilled workers, searching for other techniques to settle assignments automatically in order to offset high labor costs for remaining employees, alongside the dependence on clients. As a consequence, the proportion of job-losing persons would go up. Moreover, the inflationary level would also climb along with the wages paid. Many enterprises have to boost the price of their products to earn more money to pay for clients’ salaries. Resultantly, employees with more available finances might not be able to cover their lives at present.
In conclusion, while bringing advantages of fostering the living standard and value for workers, raising the minimum of financial income is conducive to the detrimental effects on economics and recruitment.