What is the value of one hour of a person’s time? (This is a question of economics, not of philosophy by the way – we all know that time is invaluable and it’s all we really have :-)) Is my time more valuable than that of a trainee because I have more experience? Or does it depend on what each of us is doing in that hour? Can I accomplish more in an hour than the shop assistant down the road, or the doctor in his surgery, or the accountant in his office? Sometimes maybe I can and other times not. It all depends on what I am doing for whom and the value that is placed on that work.
In our society people are paid by the hour on the whole. They have contracts that dictate the number of hours they must be present, what they should do and how much they will be paid with some time off for holidays.Whether or not they are being fully productive in every working hour is another matter of course.
There has been a debate this week about the national minimum wage. The founder of the Low Pay Commission, Prof Sir George Bain, has admitted that it’s more likely to trap people in poverty than safeguard them because it is “treated as a standard rather than a starting point by some employers.” This is hardly surprising given the state of the economy for the past 5 years when many employers, especially those in price sensitive sectors, have needed to maximise employment budgets just to survive. I think it’s human nature to use an imposed minimum as a benchmark and employers have become conditioned to view an impending rise in the minimum wage with dread. In the time when wages were subject only to market forces and open to free negotiation, they may have reached higher rates anyway. (Employers are free thinkers on the whole and tend not to like impositions.)
Minimum wages are not relevant to the majority of micro and small businesses. Our staff are qualified and skilled and we must pay competitively to attract and retain them. Minimum wages are not relevant to us personally as employers either. There are times when business owners must forgo income because profits are non-existent – that is the risk they (we) take and reserves must to built up to cater for lean times. Clearly employers tend to earn more than their staff on average over a period of time – there would be little point in being self-employed otherwise – and some compensation is needed for the sleepless nights. And when businesses fail, there is more often Schadenfreude than genuine sympathy – and that too is the risk we choose to take. Running a business is a 24 hour a day commitment and it doesn’t suit everyone. Remuneration of staff is just one of the many, many decisions that have to be made.
Should wages be set by the government, and if so how? What do you think? Is it time for a new way of rewarding people at work?
More questions than answers this week but – if I can help you with any aspect of growing your business, just let me know. It’s often useful to talk with someone who has faced the issues that you face. 01743 239283 or email@example.com
PS We are also seeking to work in partnership with a web developer to offer additional services to our clients. This is not a salaried position – you need to be one of those 24 hours a day types who can seize an opportunity and earn the rewards. Office space and full marketing support provided. Experience in WordPress, Joomla/Drupal preferred plus good communication skills.