Originally Posted by
BIRMANBOY
Economists argue about the wage-price spiral back and forth and you could spend years debating it....thats not the point here. The point is that by paying someone more you create an environment where workers feels "loved" and valued and appreciated as you will no doubt recognise when you yourself got a raise. This makes for a more productive, happier employee which in turn should encourage a better work place environment which should boost sales and profitability. The employer also gets a "feel good" factor which also encourages positive work. So the worst case scenario is, as you suggest, a "no financial advantage" but happier employer/employee/workplace. Sometimes the perception is more effective than the reality. Also as the employee sees themself being valued the possibility arises that they see their future in a more positive fashion and improve their skills and employability thereby moving up the evolutionary employment ladder.