The Minimum Wage Vs. the Living Wage

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The minimum wage has always been a hotly debated issue amongst employers and employees alike. On one side you have the employees, who feel that, in most cases, their skill, experience and responsibility warrant a much higher wage than they are currently receiving. And on the other you have the employers, who feel that they are unable to afford such an increase in wages – especially if they have a large number of staff.

In more recent years, the focus has moved from the minimum wage to what is known as the living wage. This is a pre-determined amount that is said to be the minimum that a UK employee should earn to be able to support themselves within the area that they live.

Recently, the living wage has increased from £7.65 per hour to £7.85, in most areas of the country. In London the living wage currently sits at £9.15 per hour. This is a stark contrast to the current minimum wage which is only £6.50 for over 21’s.

What People Are Saying

Firstly, there has been open concern amongst many employers, who as we have mentioned, feel that they may have trouble paying the living wage to their employees. This may be companies such as large, national corporations that run to a tight budget or smaller family run businesses that simply can’t afford to up their wages so much.

This increase in wage may mean that a company would get less members of staff for their money, possibly increasing unemployment.

On the other hand – employees feel that they will soon be unable to afford the most basic of necessities, even though they may be working full time, and even taking personal loans by Excel Financial Oregon companies providing them. This has caused many problems over the years and there doesn’t seem to be a simple solution.

The Next Steps for Employers

Although not all employers can commit to offering their staff a living wage, over 1000 employers have pledged to follow the scheme, benefiting over 35,000 employees. This may be a scheme that many more employers will pledge to follow, and as both the companies and their staff are seeing the benefits.

It may feel like a daunting step to take, to increase the minimum wage that you are willing to pay your employees – not because you have to, but because you want to. But is it a step that employers should be taking?

Although it may not make a huge difference to a lot of workers, there will be many that will be positively affected by the increase. And this may give employers more than the financial benefits they would otherwise gain from not increasing the wage.

We all know that happy employees contribute greatly to a thriving and developing business and it is up to the employers to decide how that can happen. For many it will be a happy working environment, better bonuses or more praise, and for others it will be a small wage increase that could make all the difference.

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